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1. Get pre-approved for a mortgage loan
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a) Find out how much housing you can afford: by knowing exactly your price range, you will not overlook properties you thought were out of reach and, by the same token, you will not waste time - and get unnecessarily disappointed - viewing those properties that are nice but out of your financial limits.
b) Gain more negotiating power when presenting an offer to purchase: by having a "pre-approval letter" in your hands, you are telling the seller you are a serious and able buyer. That could make the difference in having your offer accepted, over competing others which are similar in value but lack "pre-approval" status.
c) Some sellers do request prospective buyers to obtain "pre-approval" for bank financing even before allowing their properties to be viewed. Some listing brokers will not arrange any showings without such qualification, as well.
d) Be sure to get a full-blown "pre-approval" letter versus getting a simple, fast "pre-qualification" letter over the telephone. Complete "pre-approvals" will include submission of salary verification (pay stubs, w2's, etc.), tax returns, and bank statements, whereas simple "qualifications" can be easily obtained by phoning in a name, address, DOB, and SS#.
e) Complete "pre-approvals" are very reliable and, therefore, carry a lot more weight, in making you a successful real estate bidder; simple "pre-qualifications" are looked upon as typically worthless by brokers, often mislead buyers as to their true purchasing power and usually create confusion and disapointment when it comes time to apply for the actual mortgage loan, after having secured a "purchase and sales" agreement.
f) If you are a "first-time home buyer", there might be some city and/or state programs that you could qualify for. Those, generally, will help qualified buyers with items such as down payment allowances, rehab concessions and low-interest loan programs. Check these out, as part of your getting "pre-approved" process. You are now that much closer of being a good candidate to become a proud homeowner.
g) Next, you need to select the right real estate agent: me.
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2. Select the right real estate agent
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a) Who should you choose to assist you in finding the home of your dreams? Perhaps, a site where you would like to build it? May-be rental property to live-in and/or for investment? Or, that business opportunity you have been waiting for?
b) You need a full-time Realtor. Someone who can be there for you, when you need him. Someone who actively monitors the market on a daily basis. A Realtor who is available 24/7, to ensure all details in your real estate transactions are proper and efficiently handled in a timely manner. Someone who is professional and knowledgeable, a Realtor who cares to deliver total committment and expertise.
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3. Buy now - take advantage of the new tax credits
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In addition to very affordable home pricing and super low interest rates, tax credits (yes... free money) is available to qualified buyers. There are two types of tax credits available:
1. First Time Home Buyers (FTHB) - The term FTHB is often the subject of misconception. It does not have to be the person's first property ever owned. For the purpose of qualifying for this credit, it simply means an individual who has not owned a primary residence in the last 3-year period, immediately before taking title to the property acquired, which the individual intends to occupy as his/her primary residence. The credit is based on 10% of the purchase price, up to a maximum amount of $8,000.00.
2. Move-up/repeat Buyers - This new credit, recently enacted into law, is designed to contemplate existing homeowners who wish to purchase a new property which they intend to occupy as their new primary residence. One of the requirements is that the individual has owned and occupied the present home as his/her primary residence for at least five (5) consecutive years out of the last eight-year period, before acquiring title to the new property. The credit is based on 10% of the purchase price, up to a maximum of $6,500.00.
Definition of primary residence includes, single-family, townhouse, condominium, mobile home, houseboat, etc. Certain income, marital status and citizenship requirements apply to both types of tax credit. Specific deadlines for contract/closing dates apply - please consult your tax advisor for complete information.
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