Laurie Scalf

Things to consider when Buying your First Home

1. Your Budget and Financial Picture. Buying a home can be a good financial investment and will likely be your largest asset in the future. There are also great tax benefits to enjoy while you own your home. Use this calculator to see how much you can afford http://lauriescalf.point2agent.com/Calculators/page_163210.html

2. Get professionals. Ask family and friends about professionals that they know and trust.

You will need a knowledgeable REALTOR agent. A real estate professional will really help you with the entire process. They know the area market and will be a great resource of information. Commissions are generally paid by the Seller, so having an agent represent you is a wise decision.

You will also need a lender you can trust. Getting preapproved for a mortgage is your first step to home ownership. I would recommend getting referrals for at least 2 mortgage professionals and get quotes to consider your closing costs and interest rates. A reliable lender will provide you with a “Good Faith Estimate” of all the costs involved and an estimated payment. Most importantly, you will know how much you can afford.

A Home Inspector will be very valuable to you during this time. You will have the opportunity to have your home inspected for any major defects or safety issues. The price of a home inspection is minimal compared to the cost of many big ticket repairs that you would otherwise get stuck with.

3. Consider your Neighborhood Carefully. Lots of things make a neighborhood attractive. Schools, attractions, services, crime rates, taxes are among a few. Even if you do not have school age children, you should consider the school district in your decision because the value of your home depends greatly on future buyers and what is important to them.

Look where values are increasing. Your agent can add a lot of information with comparing market prices in various neighborhoods.

Check zoning around your home. A hopping new club next door may not do a lot for the future value of your home.

For more information on buying a home click here. http://lauriescalf.point2agent.com/Buying/page_163205.html

Is it Time to Buy your First Home?

There are many factors that should be considered when making the decision to buy a home or continue to rent.

1. Do you plan to stay in the area for at least 3 to 4 years? In most real estate markets it doesn’t make sense to buy a home that you will own for less than that. With the transaction costs of buying and selling you could lose money. If you stay less than 2 years, even if you make money, you will have to pay capital gains tax on any money that you make.
2. What is the cost of renting vs. buying in your area? In some areas, owning a home costs little more than renting. Beyond your mortgage payment, you have to also consider the costs of home ownership. Taxes, assessments, utilities, lawn care, maintenance, cost of maintaining appliances and repairs.
3. It’s all in your Budget! Before making the decision to buy a home, you must first look closely at your finances. Most lenders do not let you commit more than 28% of your gross income to the total of your mortgage, taxes and insurance. This combined with your total debt (cars, credit cards, student loans, etc.) not to exceed 36% of your gross earnings.
4. The Money needed to buy a home. Besides your down payment, as little as 3.5% with an FHA loan, you will need money for inspections and closing costs. A whole house inspection averages around $300 in this area, with additional inspections, such as radon, termite and chimney the total is upwards of $500. There are also moving costs. Consider all of these costs when making your decision.

Click this link to use my mortgage calculator and to get more information on what you can afford.

http://lauriescalf.point2agent.com/Calculators/page_163210.html

These numbers are for Single Family Homes and Single Family Condo's sold in Beavercreek

It's important to carefully look at your neighborhood activity, before deciding on a price for your house.

What you paid for the house + improvements you have made to the house DOES NOT EQUAL the selling price of your house.

You should seek out a Competitive Market Analysis (otherwise known as a CMA) of your area, take a look at active, expired, pending and sold listings.

The active listings are obviously your competition.

Take a look at the expired listings and be sure you don't follow their lead on price, since you actually want to sell your house, instead of it expiring.

The sold listings is where you should focus when setting your price. List your home no more than 4% higher than the reality you see in this section and you will get an offer far sooner than the average days on the market.

You won't fair better to price it higher, then lower it in a few months to get the same amount you could have sold it for in the beginning. Homes listed above market value, still only sell at market value, but take longer to sell.

The more similar the homes are in an area, the more consistent the selling price will be.

Take a look at price per square foot. This will help you get to your price in an area where homes are not as consistent.

Get rid of YOUR DEBT!

The one we always hear... WHOA on the CREDIT CARDS! I have heard the adage from every direction that if you want to get out of a hole... STOP DIGGING!

STOP DIGGING TIPS!

Carry Cash - give yourself a weekly cash allowance and you'll be more aware of how much you spend. Plus once you run out of money, you're more inclined to stop spending! It's very easy to overspend when you just run a card through a machine!

When only plastic will do.... Use a debit card, instead of a credit card.

LEAVE YOUR CREDIT CARDS AT HOME! One of the easiest ways to stop charging is to not carry the cards with you.

How many cards to you have? Keep a few credit cards with a long standing positive history and close the rest! Having a few good cards will boost your score, but having too many my hurt it. (not to mention leave you tempted to use them!)

LOWER YOUR RATES

Once your spending is under control, move on to reducing your interest rates!

There are so many credit cards out there, they are forced to be competitive. Call them and negotiate your rates. Explain to them that you plan to transfer the balances to another card unless your rate is lowered. Usually card holders with good credit can lower their rate, sometimes substantially!

Transfer it! Move the balance to the card with the lowest rate! Look for offers with low introductory rates, like zero interest for 6 months, etc. Do your best to pay this card off, with 100% of every payment coming right off your balance you will be making serious progress... BUT MARK YOUR CALENDAR! If you still have a balance when the 6 months is up, move it again to the lowest rate possible!

REDUCE your Debt!!

Start getting rid of that debt! Develop a strategy and make it happen!

Break it down - Make a list of each credit card you have, it's balance, minimum payment and interest rate.

I've read lots of strategies on which debt to pay first! It makes sense to me to pay the minimum on all your cards and put your "determination to make larger payments" on the card that has the highest interest rate!

Another strategy that I've heard is to divide the minimum payment by the outstanding balance on all your cards and pay the highest number first. Then move on to the next highest number.

Example -

Card Balance Minimum Payment How many payments

Do you have left?

Balance divided by

Monthly minimum

Sears - 1,200 38.00 31

Visa - 700 60.00 12

Discover- 4,000 100.00 40

In this case you would pay the "extra money" to the visa account until that one is gone, then move on to the Sears account. Once you have the Visa card paid off, add that payment to the Sears card and so on!

Once you start seeing the progress, it becomes addictive to see more progress!

Repeat this process until you are DEBT FREE!

Then you can start thinking further ahead! Start thinking about investing and planning!