I am about to be a first time homeowner.

[retrowire]

Any tips or advice?

Right now, I'm pre-qualified and looking for a realtor to help me find a home. Any tips with that?

Thank you DU!

[hollysmom]

1. first congratulations

second, if your realtor tries to influence you to buy more than you want, ignore them. I did and I paid off my house early.being debt free is great. Maybe if I bought bigger, I could have made more on resale, but I don't like to move and have been living here for most of my life now.

[Major Nikon]

2. For each home that I've bought, and even those I've had built, I used a pre-buy inspector

Each time the service has paid for itself in needed repairs they have found. They do things like check all the appliances, inspect the foundation, check the drainage, gutters, roof, outlets and hundreds of other things you probably wouldn't think about, but would eventually notice after you've moved in. If nothing else it gives you a lot of peace of mind.

[Tobin S.]

4. They are not too costly, either.

It's been a few years, but the last time I had one done it was $240.

[Kali]

3. OMG

this post is showing right under yours on the Latest page

http://www.democraticunderground.com/10027485720

[retrowire]

16. NO nt

[mnhtnbb]

5. Definitely make any offer contingent upon a home inspection.

Try to get an idea about neighborhoods and where you want to be located. You are better off buying the smallest
house in a better neighborhood (to maintain value and for resale) than buying a house that is more expensive than
most of the surrounding ones.

Beware of fixer-upper's. Yes, you can get a good deal, but unless you are handy and able to do repairs yourself,
the job can easily overwhelm you and turn out to be costly.

If you want good value, look for houses that only need some cosmetic help. Rooms that are painted bright or
ugly colors are an easy fix. In older kitchens, if the floor plan is good and cabinets in decent shape, you can
get by sometimes with painting cabinets, or taking some of the doors off for a more contemporary look or replacing
the counter tops. New appliances can be costly, but if you leave room in your budget for buying new appliances
it can make a huge difference in updating a kitchen.

In the real estate world, it's usually kitchens and baths that sell a house--in the right location, location, location--so
don't settle for a house with poor kitchen layout or tiny baths. When it comes time to sell and move on, it will make
the resale that much easier.

Go to open houses for ideas and to meet realtors. Find a realtor that you like--and trust (ask for references from BUYERS who worked
with the person) and stick with one realtor.

Have fun!

[underahedgerow]

6. My number ONE tip for EVERY homebuyer; pay attention, this really is very

important and valuable.

You will receive, on the closing of the sale, a 'home buyer's warranty'; an insurance policy that covers everything in the house for the first year. Plumbing, electric, water service, water heater, heating, air conditioning, structural faults, leaks, and heck, just about everything under the roof.

It costs you nothing, the seller pays for it for the first year. If you want to, you can research the best providers in your area and even negotiate for the warranty provider you want. Be very aware, some providers are much better than others, so do your research.

More importantly, you can continue this policy annually for a very low price. This is what insurance is for, so KEEP IT AND USE IT. Use it for every single little thing that goes wrong, from a light that isn't working to the leak under the sink, to the dishwasher, fridge, stove and washer you may get in the sale. I bought a fixer-upper my first time out, and this policy saved my butt many, many times. I practically had the whole house re-plumbed on it.

For your real estate broker, drive around the areas you like. Make note of the more popular signs & agencies posted in front of houses that you like, and contact them, AFTER you have googled and Yelped them for recommendations.

[Lars39]

9. Home Buyer's Warranty is negotiated.

Not every home buyer winds up with them.

[underahedgerow]

10. That's true. I had the great fortune to have an awesome Escrow agent who did all the hard work for

me, and yes, it is an option and well worth fighting for. I worked with her on all my property purchases, she was absolutely brilliant and saved me many thousands of dollars and eons of time.

[Lars39]

13. A good agent can make all the difference.

[livetohike]

7. Have fun looking! First of all, make a list of neighborhoods you are interested in. Then make a list

of features you want such as number of bedrooms and baths, basement or not, large kitchen, etc. This will save you and the realtor lots of time.

Never buy the most expensive house on the block.

When you are ready to make an offer, have 2 or 3 other homes you like in mind. Be ready to walk away if negotiations don't work out in your favor.

[dixiegrrrrl]

8. I found some very handy tips before buying this place, they worked out great.

Do NOT get an escrow account. Tell the mortgage place you will be doing your own property taxes and insurance.
Because...
your mortgage will be sold to a mortgage servicer. They make money by, among other things, trying to make you accept their overpriced insurance and constantly adding charges to your escrow account. That means your monthly payments can and will change.
In some states, they have a homestead exemption, that means you do not pay property taxes if you are blind, disabled, or over 65.
You have to apply for it at the courthouse, it is easy.
So you want to pick your own insurance company and pay your own property taxes.

Make sure your mortgage has a no pre-payment penalty clause, make them show it to you.
That means you can pay off the mortgage ahead of time and save a ton of money/
and how do you do that?
Well, the first 5 years of a mortgage, the payments are all going to the interest. Actually the first 10 years, you make very little on the principle side of the payments.
If you can pay any amount extra every month on your principal payment for the first 5 or more years, you save thousands on interest payments and pay off the mortgage faster.
Example: we got a 30 year mortgage in 2005, but now the mortgage receipts show we have a 15 years to go, not 20..we knocked off 5 years of the payment schedule by paying 50.00 a month extra for just the first 5 years,

Go to Bankrate.com and look over their mortgage calculation tools, they show what various payment schedules will save you tons of money.

No escrow and no pre-payment penalty are vital things to have.
But I think they may require a certain percentage down payment ( usually20%) to make that happen.

don't buy a house ( or even a car) unless you know how the financing works, because the lenders are trying to get you to pay thousands of dollars over time, and usually the borrowers are only focused on how much a monthly payment is.

Make all offers "subject to satisfactory home inspection"
If they accept your offer, spend the couple hundred to get an inspection, and read the report.
You might find things in the report, as we did, that can lower the asking price.

Some states, like Alabama, sell houses "as is, where is" and sellers do not have to tell you the house is sitting on top of a nuclear waste dump or has been flooded and the floor joists are like carboard.
Make sure you know what your state requires, so if you run into a problem, you will have legal recourse.

The roof should be no more than 10 years old, same with heating/cooling.
Our insurance made us replace our 15 year old roof.

By 2020 all cooling systems using freon will be obsolete, freon will be illegal, and everyone has to buy new units that cool with an environmentally acceptable coolant ( I forget the name of it), cause the new stuff will not work in old systems.
Figure 5-8 thousand to replace.
Ask me how I just found that out........

Congratulations....this is an exciting decision, one which will pay off nicely if you do your homework.

[seaglass]

21. We just bought a house last month and got a lower interest rate by escrowing our taxes and insurance

This is the 2nd home we have bought and it worked the same way with our first home. We chose our own insurance company and the only time escrow has changed is if/when the insurance/taxes increase.

There may be other reasons for not setting up an escrow account but being forced to use an insurance company not of your own choosing has not been my experience.

[dixiegrrrrl]

23. I would love to know who is servicing your mortgage.

When Bank of America was servicing our mortgage,they kept trying to "force place" THEIR house insurance.
Which is illegal.
They would ask for confirmation that we had paid our annual premium, then "lose" the forms we sent them
then say they never received the fax from our insurance company confirming our insurance.
This was in 2006 on......after BOA bought out Countrywide but continued the mortgage fraud tricks. It continued for 3 years.
It stopped only after we sent the information by confirmed special delivery, which they had to sigh for.

The bank's fraud about servicing mortgages was finally addressed by Congress and later by the Consumer office which Elizabeth Warren set up.
all the big banks were heavily fined, then fined again when they did not carry out the required reforms.
Because of Elizabeth Warren, banks now are audited for mortgage standards every quarter.
So what they did, they sold their serving business to companies like Nationwide and Green Tree, which were not required to follow the new laws ( until very recently)

I got Green Tree, so looked them up. Bad.
They started getting oversight by the Consumer office and had to pay huge fines for ripping people off over illegal mortgages, and illegal escrow practices.
It got so bad that the Green Tree stopped doing business last Sept. and another arm of the parent company took over.
that company is Ditech, which has years of fraud history for consumer loans.
In fact, a report has just been released that Dictech once again has failed to meet some of the standards for servicing mortgages.

Because of the years of mortgage and foreclosure fraud, which includes escrow rip offs, I prefer not to use escrow.
Mortgage servicing companies can often change ( again, we went from Countrywide in 2005 to Bank of America, to Green Tree,
to Ditech, with no choice at all).

[seaglass]

27. We deal with a Mortgage company, not a traditional bank. We are expecting that the loan will be

sold before we make our first payment. Probably because we always get our own insurance and escrow it there has never been a question about purchasing other insurance even when our mortgage has been sold. Basically we are a year ahead on insurance which is annoying but we would have to pay it anyway and I'd rather get the lower interest rate.

[LiberalEsto]

11. Interview several real estate agents

Before deciding on a buyers' agent to work with you.

Also look at houses online, and watch HGTV programs like House Flippers, Property Brothers, House Hunters, etc. to get ideas on what you want, and don't want, in a house.

Do you want a fixer-upper? Are you willing and able to do the work yourself?

Research neighborhoods, talk to homeowners.
We once had to buy a house in a hurry in a new state where we didn't know anyone, because my husband got a new job. The day we moved in, my small children went in the back yard and found men drinking in the yard and the wooded area behind it. We discovered we were close to a beer and wine store, and the local drunks had a hangout that included our yard. Because my little girls couldn't play in the yard, we had to install a 6-foot fence. Then the drunks smashed bottles on the fence, urinated on it and spent their afternoons and nights drinking and cursing as usual. We ended up selling the house at a loss and moving in two years.

[PasadenaTrudy]

14. I'm guessing you aren't in CA!

I'd ask, how many million are you looking to spend?

[retrowire]

15. NC East Coast! :D

No millions here. Not even a quarter!

[TexasBushwhacker]

17. If you can't put down 20%

be sure and check out loans other than FHA. For low down payment loans, FHA loans will tack on MIP - Mortgage Insurance - of $50 or so for the life of the loan. Private loans through banks an such will tack on PMI which is also mortgage insurance, but it only lasts until your loan balance reaches 80% of the value of your property. With rising real estate values, most people get their home reappraised after a few years and are able to drop the PMI.

You can look at crime rates in the area you're looking at here:

Spotcrime.com

[oldandhappy]

18. Enjoy! and congratsl Good to have your own roof.

Read number 6.--
Be sure to have an inspection.
Plan to put 2-3% of purchase price a year into taking care of the house, not counting optional stuff.
Be very patient with yourself the first year. I always have to go thru a 6 month 'why did I do this' adjustment period.
Differentiate between what can be fixed and what cannot. I wanted a view. Realtor was worried about the roof. Roof is fixed and I have the view!
Don't be afraid to walk away if seller wants more than you want to spend.
Check the commute to work, if appropriate. Don't take the word of someone else re time and traffic. Ditto parking.
Ask for estimate of property taxes and utilities in writing.
If there is an HOA involved, ask re any legal cases pending and debt as well as monthly fees.

Have fun!

[Blue_In_AK]

19. I agree about the inspection.

I bought my house (a HUD foreclosure) in 1990 and didn't have an independent inspection done, trusting in the government's paperwork which said everything was fine. A month after I moved in, the roof was leaking like a sieve and had to be entirely replaced. I sued HUD and the property manager for negligent inspections. HUD didn't give me a cent, but the property manager paid me $15,000 which helped.

I'm still here and love this place because it's a duplex, and even though the rent I charge is below market, my tenants still pay most of my mortgage, but it was pretty stressful at first.

[mythology]

20. The biggest thing that you can't change is the location

Make sure you can live with the commute to work and other places you go.

Changing things indoors is generally easier than you would think if you're willing/able to do the work yourself.

If you are so inclined, you can also see about getting the floor plan into home remodeling software to get an idea of what can be done before buying or making changes.

[DebJ]

22. My parents bought a home and after moving in, discovered NONE of the windows opened.

This was back in the 1960s, and the home was post-WWII. The windows opened via a type of drawstring, and every one of the cords were
broken. We moved in during July, hot as hades, no central air back then. So, although the real estate agent thought I was a bit funny, I opened every single window before I bought my home.

Also, I brought a tester for all of the electrical outlets to make sure they worked as well.

If you are buying an older, pre-existing home, talk to everyone that you know who owns one, and see what they say.

[steve2470]

24. I haven't read the entire thread but here's my two cents....

Do not ever forget that YOU are responsible for repairing and maintaining your property. Unless you do it all yourself, that's going to cost you X amount per year. If you're smart, you'll save that much every year in an interest-bearing account for those untimely emergencies like the roof leaking, plumbing going bad, etc. Figure out replacement costs for your roof and other parts of your house (I'm assuming house here) and then amortize it over the expected number of years. Otherwise, you're going to have huge charges on your credit cards or a huge hit to your savings account at bad times.

Also, find out upfront roughly what your tax bill will be per year. If you don't pay your taxes, eventually the local government is going to take your home. That's the way it is. The taxes might go up and/or the value of your home might go up, which will cause your taxes to go up. Same advice as above, save that money every year in an interest-bearing account. Pay your taxes immediately when they are due. I get a 4% discount for doing that promptly, and you might also. At least you get it off your mind and the taxes are paid.

Every month (if you're smart) = Principal payment + interest payment + taxes set aside + repair/replacement costs set aside + regular maintenance costs (lawn, pest control, etc) + other fees set by your lender.

Best wishes and good luck, it's much better than renting if you can afford it!

[hedgehog]

25. You don't mention kids,but you may want to check out the local schools -

a half mile to the west would have put my kids into a troubled district. We ducked the bullet on that one because it never even occurred to us to check it out.

Being in a good district helps re-sale value as well.

[Liberal_in_LA]

26. Remember..it's your purchase. Don't let realtor pressure you

[BlueCollar]

28. Consider Credit Union financing

Unless you are VA eligible. Take your time and check back in.

There are forums here on DU about Doing it yourself. You might surf some of those threads to give you some ideas about you might be looking at.

Good luck and remember the saying...

"Time spent in reconnaissance is seldom wasted"

[My Good Babushka]

29. Just, congratulations!

Have fun fixing everything. No matter the house, no matter the inspection. Something will need to be fixed some time!

[irisblue]

30. Pre home purchase inspection! and have a scope of the sewer/water lines (trees need water)

[jehop61]

31. Don't overspend

A house will always need upkeep and redecorating.. Don't set yourself up for mega worries down the road over expenses. Enjoy yourself too. Enjoy the house hunt. It can be fun!