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I feel compelled to write this post, because most first time home buyers don't understand the process of buying a home, but they don't know that they don't know the process. They think they know, but they don't. So this post is a short little primer on what you should do when you decide to buy a home.

Get pre-approved for a loan. Getting pre-qualified was enough in days gone by, but not in today's market.  This is the only way you will know what price range to begin looking in and the only way a seller can have confidence in your offer. price tag

Make sure you have enough in savings to cover the down payment AND closing costs. If you're short of cash, ask your banker about financing the closing costs into the home loan.

This is the biggest mistake that I see first time home buyers and even homeowners who have not bought a house in several years make. They forget that they are going to need more than just the down payment to buy a house.

In Louisiana, the standard purchase contract contains language putting the burden of paying the closing costs squarely on the buyer. Of course, these costs can be negotiated, but rarely will a seller pay 100% of these costs. So, the buyer must be prepared to pay at least some portion of these costs.

Your banker should give you what is called a Good Faith Estimate of all the costs of buying a home which should include the itemized closing costs.

If you have to deduct the closing costs from the amount you had designated for a down payment, do that, then call your banker back and get them to adjust the prequalification amount taking the reduced down payment into account.

Look at houses in a price range based on your new loan amount + down payment.

Make an offer in writing on the house of your dreams. This is another common misunderstanding that homebuyers have. They think everything can be done with a phone call. They think that I am going to call up the home owner or the listing agent and make an offer for them.

Everything must be in writing. So when a buyer has decided on a house, there is a contract to fill out which contains all the details of the offer to purchase the house. This is then delivered to the listing agent who records when he/she received it. This protects the buyer to ensure that their offer was delivered to the seller in a timely manner.

Next, if you're counting on the seller to pay a good portion of the closing costs, and the deal hinges on this, be prepared to be disappointed. And don't blame your agent. Unless you're making an offer very close to the asking price, the seller will probably be disinclined to pay closing costs unless there are circumstances that make them desperate to sell.

Keeping these things in mind will go a long way to helping you get the home of your dreams!

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You're at Home with Heather
Shreveport and Bossier City, Louisiana Real Estate

Shreveport Home Connection
Coldwell Banker J. Wesley Dowling & Assoc. LLC

Serving your real estate needs in Shreveport, Bossier City, Benton, Haughton, Keithville, Stonewall, Blanchard, and Barksdale AFB

Licensed in Louisiana

 
This post has been included in Louisiana Information Caddo Parish, LA Information Shreveport, LA Information
Post is included in group: The Single Home Buyer and Seller
Post is included in group: Louisiana Real Estate
Post is included in group: 1st Time Buyers

1 Comments on First Time Home Buyer 101

SEP
26
2008

This is a good start - and then there's more to the process as well! 

And, many buyers (not just first-timers even) are under the impression that our main job as an agent is to FIND the house for them.  That is sooo not true - picking out the house, no matter who "found" it, is only the beginning!  Working through the rest of the process, all the way through closing, is where a buyer's agent is extremely valuable.

Best wishes!

7:58am • #1

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Heather Goodwin ~ Shreveport Louisiana Real Estate

Shreveport, LA

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Coldwell Banker J Wesley Dowling

Office Phone: (318) 869-5894

Cell Phone: (318) 918-8248

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