Many potential first-time home
buyers feel overwhelmed and think homeownership is an impossible dream.
Well, it's not! This website will help you gain knowledge about the
home buying process and will hopefully give you the courage to keep that
dream alive. The first bit of advice I will give you is to hire a
buyer's agent (me or another realtor) who will look out for your best
interests and make sure you are not making mistakes than can cost you
several thousands of dollars. This is the biggest financial decision
you will ever make, so it's essential that you work with a professional,
trustworthy realtor who's there for you every step of the way. I'm a
43-year old Denver native and seventh-generation Coloradan, so rest
assured, I'm not going anywhere!
Our website sponsor -
Anthony Rael is here to make sure:
1. you fully understand what it takes to purchase a home
2. you work with a reputable mortgage lender who won't take
advantage of you
3. you are utilizing every available first-time buyer
resource you're entitled to
4. write an purchase offer that protects you before & after
5. that all of your questions are answered in a timely,
6. you don't get overwhelmed with the process - I'm here for
you realize that the seller pays the commission to the agent who brings a
buyer for their home? That's right, it doesn't cost you anything
to be represented by a Buyer's Agent who is
advocating and negotiating on YOUR BEHALF! Being familiar with the
different ways a real estate agent can represent you, plus all the
different financing options and programs available to assist you and
knowing the ins and outs of where to find a good deal which can save you
thousands of dollars! There is no reason why you shouldn't have a Realtor on your side when
buying your first home!
Housing Assistance Programs
Author and real estate
broker Jim Stacey claims that there are three stages for the
first-time home buyer: contemplation, comparison, and commitment.
He urges prospective buyers to get through the first stage on their own,
with the help of friends and family members. The road between
contemplation and being ready to commit to buying a house is arduous and
emotional, and Stacey has learned that the best use of a broker's time and
skills is to enter the fray after buyers have done some preliminary
Part of this background work
is figuring out whether you're ready to be a homeowner - financially,
psychologically, and emotionally? First, make sure your credit record
will appeal to a lender. If you have doubts, get a copy of your
credit report in advance (my lenders provide this FREE of charge). If your
credit history is less than shiny, you're probably better off renting
while you buy down your debts and polish up your record.
Figuring Out What You Want
No matter how well you can picture your dream house and
communicate your ideal to me, the house you finally fall in love with may
have little resemblance to the image you started out with. But you
have to begin somewhere, and a detailed wish list is a great head start.
Let's say your wish list looks like this, in order of priority:
Two bedrooms, two baths
Safe, quiet neighborhood
Ability to add on
No major repairs needed
Near close friends or
Close to downtown
Lots of natural daylight
Good investment with
excellent resale potential
Enclosed laundry area
Walk-in closet in master
Storage space for
lawn/garden and sports equipment
Gas hookup for stove
Back deck or patio
Close to work, schools,
Finished basement for
office or guest room
No threat of commercial
French doors leading to
Close to public
Now, how would the list change
if you had to settle for only 10 of your wishes in your price range?
If you had to narrow it to five, would your top priorities be different?
When you start looking at houses, this information will be invaluable to a
Realtor as he or she matches your requirements to available houses.
What Can You Afford?
Every market is different, but the first step to answering this
question is finding out
what you can pay on a monthly basis after you've
made your down payment...5, 10, or 20 percent of the asking price of the
Visit a loan officer. The best
way to learn what you can afford is to get pre-qualified for a loan. We
have excellent resources to lenders who will ensure that you get the best
loan rates and terms. Pre-qualifying won't cost you anything.
You'll walk away with a good idea of how your income, assets, and
liabilities translate into what you can afford, and it can also help your
chances of beating out the competition in a sellers market (where there
are more buyers than houses on the market).
Do the math. You can
also do a simple
calculation on your own. Broker wisdom says that monthly
payments should be 25 to 33 percent of your monthly gross income. Use the
calculator to get a rough idea.
Additional costs. Keep in mind that in addition to the purchase
price you'll need extra cash for closing costs, inspection, and future
expenses. All in all, to get through closing - meaning, once you've
signed the last remaining paper after agreeing on price and terms with the
seller - the cost will typically be 2 to 7 percent more than the
agreed-upon selling price. If you calculate that from the middle zone, at
4.5 percent, a $200,000 house will cost $209,000 to purchase. Be sure to
consider annual property taxes and repairs (predictable and unexpected).
Take heart in knowing that
most first-time buyers are simply getting into the market. Your
dream house may be two or three houses into the future, so don't feel like
you have to spend every penny you can afford if it means trading off some
Starting the House Hunt
Now that you have an idea of what you can afford, you can focus
on whether you're in the market for a condominium, loft, townhouse,
single-family detached home. Contact our website Realtor sponsor
Anthony Rael and he
will help educate you about what to look for and avoid, provide reliable
references for other experts you'll need along the line - such as lenders
and inspectors - and represent you in negotiations and at closing.
Now you're ready for the fun
stuff: pounding the pavement. Go to as many open houses as you can
stand, even at times when I'm not available, and then go to another -
(just be sure to sign in under my name). In the
neighborhoods you're considering, include some homes you know you can't
afford and some priced below your means. Think of it as leveling out
your learning curve.
Talk to friends and family
about their buying experiences. People are often surprisingly open
about what they've learned about financing, construction - and even
themselves - in the course of buying their first house.
And finally, if there are
times when you just can't bear to see another overpriced house with
kelly-green shag carpet, take a day off - and remind yourself that someday
you'll know it was all worthwhile. Enjoy the article on "Nine
Steps to Buying Real Estate & Homes in Denver Colorado" or take a look
at my Colorado Community Resource
Directory featuring links to schools, city government agencies,
shopping, dining, entertainment and more!