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As you are no doubt aware, buying a home is one of the biggest financial decisions you will probably ever make. It’s no wonder that it creates so much stress in the lives of normally calm people! However, with a little planning and following the proper steps, purchasing a new home can be a snap. You should also rest easy in the fact that you have chosen one of the best markets in the country in which to buy.
“The most common response we hear from families moving here is … that they just love the people,” said Carol Pyfrom, owner of Carol Pyfrom Realty. “The weather is a contributing factor, the mountains, the closeness to the beaches, the central location off Interstate 85, our cultural arts are all wonderful – but the people of [the area] are the best!
For first-time homebuyers, it’s probably best to let the experienced real estate agents and mortgage professionals of the Upstate region aim to make the process as painless as possible.
But perhaps even before contacting a real estate professional, it’s a good idea to do a little homework.
To find out vital information about the area, including schools, entertainment, recreation, weather, traffic, government, tax rates, and economic conditions, visit Web sites for local newspapers, the local chamber of commerce, and city or county governments.
Another step you can take to help yourself is to request a copy of your credit report. If your credit report shows a lot of small balances, try to pay those off before applying for a loan. If you have open credit lines without balances, it’s best to call the credit card company and close the accounts.
Once your credit report is in great shape, it’s time to sit down and work out a budget. How much can you afford to put down on a home purchase, and what monthly payments fit within your income level? Don’t forget that your monthly expenses will include insurance, taxes, and possibly homeowner’s association dues, in addition to debt (or mortgage) payment.
If you plan to buy an older home, keep in mind that certain items, such as a new roof, water heater, replacing rotted wood or siding, and heating and air conditioning, can wreak havoc on your wallet. So while it may be tempting to purchase that big, expensive home, try to set a realistic goal for your mortgage so you won’t be strapped for cash each month.
When you have the answers to some of these questions, it’s time to choose the perfect lender for you. Talk to realtors, family, or friends, but make sure you choose someone with which you fee comfortable.
When you have a few names and contact information for possible lenders, it’s a good idea to compare their rates and fees. Look at other important information, such as points, application fees, origination fees, broker fees, appraisal fees, and legal fees. These extra costs will affect your bottom line, so it’s good to know what to expect well in advance so there are no surprises at closing.
Then there are two processes that you should be aware of—prequalifying and preapproval.
Prequalifying for a mortgage loan is an informal process wherein you provide information about income, assets, and credit to a lender who does not verify the information given, but only provides a loan amount that would be approved, assuming that your information is correct.
Preapproval is when you actually go through the loan application process. The lender takes an application, pulls a credit report, and runs the information through one of the automated underwriting systems supplied by investors, according to the Mortgage Department at First Citizens Bank of South Carolina. The applicant will be asked to furnish pay stubs, W-2’s, bank statements, retirement statements, and tax returns, if applicable. In most cases, there will be an application fee.
“Preapproval for a mortgage is very important,” said Sheila Young, realtor with The Young Real Estate Team.
After you have your financial house in order, a good place to visit next is your local realtor’s office. Realtors know the market and can help you avoid pitfalls that might not be immediately obvious to the unseasoned home shopper.
Once you find the perfect house, the real work begins. In addition to securing financing for the purchase, you should know what you are responsible for because closing on a home isn’t just about signing the contracts.
Buying a new home can be quite gratifying, especially if you get it right the first time. By choosing the Upstate area in which to settle down, you have already taken a step in the right direction.
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