Finding Your Home
Finding the perfect home in Pendleton, Or can have a lot to do with finding a compatible real estate agent, especially in today’s evolving mortgage landscape. It’s crucial to be in contact with an agent before starting the home search, because you might be looking at x when all you can afford is y. First-time home buyers in Pendleton should make it clear what features they’re looking for and how much they’re willing to spend.
Fix Your Credit
The first step toward buying a home in Pendleton takes place months before walking into your lender’s office. It’s crucial to check your credit score at least three to six months ahead of your mortgage application. You can request a free copy of the report from each of the three credit bureaus Experian, TransUnion and Equifax.
Even if you don’t have great credit (720 or above) the most important thing to do is to take stock of what the figure means. It’s more about why the number is than what the number is.”
Prepare for Down Payment and Closing Costs
A generation ago, it used to be the norm to put 20 percent down, but with the market in its current state of flux, many first-time home buyers in Pendleton are finding ways to pay just 3 to 5 percent of the total cost upfront. Federal Housing Act (FHA) loans increasingly have become a popular option for first-time buyers. These competitively low-interest loans are ideal for buyers with less than perfect credit, and because the Department of Housing and Urban Development (HUD) minimizes the risk of default for lenders on these loans, borrowers are only required to put down 3.5 percent of the cost–a far cry from the traditional 20 percent down payment.
Paying More at the Start
There are advantages to paying more at the start. A larger down payment ultimately means smaller monthly bills down the line. Also, if you purchase a conventional loan (i.e.: one that is not backed by a federal agency), paying 20 percent or more upfront will eliminate the need to pay Private Mortgage Insurance charges. While it’s important to note that FHA loans also carry mortgage insurance with a down payment of under 20 percent, their low barriers to own still make them a good choice for first-time buyers.
Figure How Much House You Can Afford
Your debt-to-income ratio (DTI) is the percentage of your gross monthly income set aside for paying debts. While some loans may qualify you for up to 50 percent of your monthly gross income, it’s advisable that you use no more than 30 percent. Be realistic about how much you can pay, because an unexpected event could tear a hole in a tight budget. So when calculating your budget, be completely honest about your spending habits, even if lenders say you qualify for more.
Make an Offer
Sellers in Pendleton can price a property however they see fit, but that doesn’t mean homebuyers should pay a ridiculous cost. “Get your agent to pull all the comparable sold properties that occurred in the last six months,” says Adamaitis. “How many were short-sales? How many were foreclosures? Then gauge by square foot the comparable cost.”
Get Your Money’s Worth
At signing, the buyer should demand that the contract be contingent on an objective appraisal of the house. Look into the history of the home and make sure there aren’t any liens against the property. You should be able to negotiate with the seller to make any necessary repairs to the house before closing on the deal.
Stay on Course
Beginning to end, you can expect the entire process to last months. Of course, with as much great inventory on the market as there is, it’s not unusual for homebuyers to find something within two to four weeks.
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