My Hattiesburg

7 Steps in Buying a Hattiesburg Home

Step 1: Find out your price range.
I eluded to this in a earlier post but I will say it again for those who haven’t read that one. I have devised a formula to give you some kind of idea in how much of a home payment you can handle.

Gross Monthly Income * .28 = Projected Monthly Home Payment

For example: If I made $2000 a month the I would say 2000 * .28 = 560. So this means that I would be able to afford a house payment in the area of $560.

Step 2: Get a Loan Pre-Approval
You can do this by going to a direct lender such as a bank or to a mortgage broker. After the process is over they will give you a pre-approval letter in which states the certain size mortgage that you qualify for. This letter will be very helpful to prove to real estate agents and sellers that you are not just window shopping.

Step 3: Hiring an Agent (Buyers Agent)
Using a agent can be very advantageous to a buyer. Agents have access to a greater number of properties that other wise you may have never found. They also have different ways in searching for properties that the general public do not have. When signing with a agent make sure that it is a buyers agreement. On signing this agreement the agent is bound by law to look out for your best interest. Before signing the contract you will need to negotiate on their fees and the amount of service you will receive for those fees, and you can arrange for them to be paid out of the transaction, not out of your pocket. When using a agent you need to communicate clearly on what type of property, price range, and area you are interested in.

Step 4: Write a Offer Contract
When you find the house that meets the criteria of your likes and dislikes and you think that it is the one you want then you will have to make an offer. The offer contract can be made through your agent or your attorney. In your offer contract be sure to spell out what you are willing to pay for and what you are not, when you want to close, and when you want to take possession of the home. Your contract should be contingent upon getting an inspection and evaluating the results. Should the inspection reveal a big problem, you and the seller can renegotiate the purchase price if you are still interested in buying the home.

Step 5: Getting the Loan Going
As soon as the seller accepts your contract you should go ahead and start following through with your loan. You should take a copy of the offer contract to the lender so they can start the loan process in earnest. If you have already been pre-approved it will pay off big in this step because the loan process will go somewhat quicker.

Step 6: The Appraisal and Inspection
The lender will arrange for the appraisal of the home, which may affect the terms of the loan or if the loan is granted at all. The liklihood of a house selling for more than the appraisal is slim but in such a case you will need to go back to the seller and renegotiate the price.

You will have to get the inspection arranged. Your agent will probably know of an inspector that you could use but you may also want to shop around in the phone book. If the inspector finds any major problems you will want to make sure the seller fixes them before you buy the home.

Step 7: Closing
Just because your at the closing table doesn’t mean that your out of the woods yet. Many things could still happen to jeopredize you getting the house. Some situations may include: the appraisal comes back the day before and is to low, your credit report had a unexpected glitch, or a problem with the house that wasn’t fixed by the seller. These are just a few problems that could occur on the day of closing and it may take time to handle these problems. That is why it is so important to do steps 1-6 to help insure closing goes smoothly and you get your new Hattiesburg home.

The 10 Biggest Home Buying Mistakes: Mistake 6-10

Mistake #6: Not Having the Home Properly Inspected
Get an inspection from a qualified and respected professional. Unneeded surprises could cost you in the long run.

Mistake #7: Not Getting What You Want Because You are Impatient
This is a big decision in your life. Impatient decisions can lead to big mistakes.

Mistake #8: Not Checking a Builder’s Reputation When Building a New Home
Talk to several people that live in the builder’s houses and get their likes and dislikes.

Mistake #9: Waiting for a Better Market and Interest Rates
A man once said “The rear view mirror is always clearer than the windshield”

Mistake #10: Not Buying at All
If you can afford a home and don’t make the purchase then you will be missing out on tax deductions, home appreciation, and building home equity.

The 10 Biggest Home Buying Mistakes: Mistake 1-5

David Weekley, CEO of Houston-based David Weekley Homes, is one of the country’s largest home builders. He has compiled a list of the 10 biggest mistakes people make when buying a home.

Mistake #1: Not Doing Your Homework
The old saying “knowledge is power” is so true and with the rise of the Internet there is a ton of information available to help prepare you to buy a home. So, there is really no excuse for going out unprepared.

Mistake #2: Trying to Make a Savvy Investment
You need to buy a house that fits the needs of your family. Don’t try to guess what is going to happen to the market in 10 years.

Mistake #3: Choosing a Poor Location
Is you home on a busy street? Is there a retail center out your back window? Choosing a house around a lot of hustle and bustle may wear on your nerves down the road.

Mistake #4: Overlooking a Inferior Floor Plan for and Attractive Exterior
The house you look at may have tons of curb appeal but you don’t do all your living in your yard. No matter how good the outside of a home looks you still need the inside of the home to be livable.

Mistake #5: Overlooking How the Home will Function for Your Family
How does your family really live? If you eat-in a lot you may want a nice big kitchen. Do you entertain enough to constitute having a formal dining room? Could you do some of your office work at home if you had a home office? The bottom line is that the house you pick should be functional for your family.

3 Steps in Deciding to Buy or Rent

Step 1: How long do you plan on staying in a particular area?
If you have a job in your home town then you probably would do good by owning your home. However, if you are in town for a limited number of years then you probably shouldn’t buy a home. It is really self explanatory.

Step 2: Your Financial Situation
Several factors come into play here such as your income, credit card debt, current living expenses (car, groceries, medical bills, ect..) and savings. A general rule of thumb is that the monthly cost of maintaining your home (mortgage payment, insurance payment, and tax payment) should not exceed 28% of you gross monthly income. If the maintaining cost exceeds 28% of your monthly income then you would be better off renting until you can get your monthly income up some.

Step 3: Tax Benefits
The federal government allows homeowners certain income tax advantages. Homeowners may deduct from their income some or all of the mortgage interest paid, as well as real estate taxes and certain other expenses that were involved with purchasing the house. Also married taxpayers who file jointly can exclude up to $500,000 from capital gains tax for profits on the sale of a principal residence and taxpayers who file singly are entitled to a $250,000 exclusion. Renting a home does not provide any tax benifits that I am aware of. However, you should always consult a certified tax professional when dealing with such matters.