So you survived another holiday season renting; that time of year when you visit family and get to hear stories of how well your cousin is doing. You also may get to hear your neighbors down the hall parting all night with their ugly sweaters and holiday punch. The best part may be shoveling your driveway again, while your landlord’s phone just seems to go to voice mail. It also could mean cold showers when the oil runs out and it can’t be filled until the next day.
For those who need and want the change, I offer you some resolutions that will make the process a bit easier and will get you ready for the transition.
Resolution #1: Budget, Budget, Budget- If you are living paycheck to paycheck and not budgeting, you are surely wasting money. It seems that with some people, no matter how much they make, they still spend it all. Taking the time to create a spread sheet, analyze what you spend your money on, and budget some savings in each pay check, will pay off in the long run. Knowing your budget is the first step to successful homeownership.
Resolution #2: Know your credit score, and learn more about how it works. There are a multitude of commercials advertising sites where you can get and monitor your score; however there are several free sits as well. Rather than spend money we recommend sites like www.annualcreditreport.com this site is a free site that will allow you a free report once a year from all three credit bureaus. They will not give you a score, but will give you the report which will show you what items are showing on your report. www.CreditKarma.com is another free site that offers you a Tran-union score as well as gives you some education on what is hurting and helping your score. There is no magic way to fix a credit score, but the more you learn about how it works, the easier it will be to raise it, and when you raise it you will be in a better buying position.
Resolution #3: Interview and work with a Realtor who will be your Buying Agent. The worst thing you can do is call the selling Realtor and get advice on the home he or she is selling. They are hired by the seller to get the highest and best offer on that home and they do not work for you. A Buyer agent will have fiduciary duties to their Client (you) and will work in your best interest. The best part about this, is in most cases, the commission is getting paid by the selling agent, so it costs you nothing. Also, working with a Buyer agent has been proven to get you better pricing and avoid the pitfalls that can occur during the process.
Resolution #4: Take the time to learn about the different loan options, and the requirement and restrictions of each. Don’t just go to your bank, ask your Realtor about other options. Many times you may qualify for a better loan then what your bank can offer you, and that can make the purchase more economical and can possibly save you money in the long run. Next get pre-qualified to know how much you can afford. During the pre-qualification process your lender will let you know about restrictions on certain properties due to the loan type you want; this will help narrow your search and save you time.
So remember, you don’t want to rush into this, take the time to make these resolutions a part of your purchasing plan. If you do you will find that making that home purchase will be easier and a lot less scary.