Lisa Scungio's Blog
No one should be forced to break the bank to secure a terrific house. However, a first-time homebuyer may be more likely than others to overspend on a residence, particularly if he or she fails to understand the ins and outs of the housing market.
Lucky for you, we're here to teach you what it takes to browse the real estate market effectively so you can find a house that matches your budget.
Now, let's take a look at three tips to help a first-time homebuyer purchase an affordable residence.
1. Examine the Housing Market Closely
Many great houses are available, and a first-time homebuyer should review a broad range of residences closely. By doing so, this homebuyer can establish a price range for his or her home search.
Evaluate the prices of residences that are currently available in your city or town. That way, you can find out what it costs to afford a home that may serve you well both now and in the future.
Also, assess the prices of recently sold residences in your area. With this housing market data in hand, you can find out whether you're about to enter a buyer's market or seller's market and plan accordingly.
2. Get Pre-Approved for a Mortgage
Pre-approval for a mortgage can help you map out a homebuying budget before you enter the real estate market. Thus, getting pre-approved for a mortgage can make a world of difference for any first-time homebuyer, at any time.
To get pre-approved for a mortgage, you'll want to meet with several banks and credit unions in your area. These lenders can teach you about different mortgage options and help you select one that corresponds with your budget.
In addition, be sure to ask plenty of questions about potential mortgage options before you make your final mortgage decision. This will allow you to understand the differences between fixed- and adjustable-rate mortgages and choose a mortgage that can help you avoid the temptation to overspend on a residence.
3. Collaborate with a Real Estate Agent
When it comes to pursuing a house for the first time, don't leave anything to chance. Instead, collaborate with a real estate agent, and you can streamline the process of purchasing an affordable residence.
A real estate agent helps take the guesswork out of looking for residences. He or she will keep you up to date about new houses as they become available and set up home showings on your behalf. Plus, this housing market professional will do whatever it takes to guarantee you can obtain an affordable house that surpasses your expectations.
Perhaps best of all, a real estate agent will help you alleviate stress throughout the homebuying journey. And if you encounter challenging negotiations with a home seller, a real estate agent will step in and help you get the best price for a residence – without exception.
Ready to purchase a house for the first time? Use these tips, and you can acquire an affordable residence that you can enjoy for years to come.
Although most people think of real estate investments in terms of real property that they can see and touch, buy and sell, or rent and manage on their own, there is a popular form of real estate investment that is not as personal and interactive.
In many ways, it is easier, featuring the expectation of a steady, long-term income stream, and requiring less cash, almost no worry, and little concentrated effort. Buying shares in a real estate investment trust (REIT) is one way to create a diversified investment portfolio, and such investment opportunities are now widely available even to those with limited cash reserves and minimal investment expertise.
Instead of holding the deed to a specific piece of property, an investor in an REIT holds shares in a corporate entity that operates under strict guidelines established by the Internal Revenue Service. The law that governs such investment was actually passed in 1960. Today, it is estimated that about 80 million Americans own shares in the hundreds of REITs that are publicly traded through the SEC or offered privately by brokers and financial advisers. In recent years, there has been substantial growth in REIT investment through pension and retirement plans.
For the individual investor considering REIT investment, there are some cautions as well as some decided advantages.
Advantages of REITs
First, on the plus side, a relatively small investment is required. Buying individual properties either to rent or for resale typically requires a substantial cash outlay, but REIT investment can begin with little cash outlay. This may be the prime advantage. Because one of the regulatory provisions limits major shareholder presence in any REIT, there is a great deal of opportunity for small investors.
Additional advantages include:
- Liquidity: Particularly with publicly-traded REITs, buying and selling is as easy as contacting a licensed broker and issuing the order.
- Steady Income Stream: REITs are required to return 90% of taxable income to investors each year, in the form of dividends.
- Regulation & Transparency: Corporations operate under strict governance, and must be managed by trustees or a board of directors.
- Beneficial Risk-adjusted Return: With initial due diligence, the risk of loss over the long-term is very low.
- Minimal Growth: The possibility of capital appreciation is less than that of other investment types.
- Tax Consequences: REIT Dividends are taxed as normal income under IRS rules.
- Market Risk: All real estate value is market driven, and REIT's are no different. Investors should be aware of current trends, and take those into account when comparing various REITs. Certain segments are perennial high performers, while others are location and use-driven.
- Associated Fees: Pay attention to management and transaction fees, not only those charged by investment brokers, but also the operating expenses of the REIT itself.
Investment decisions should always be made following due diligence, and with personal goals and objectives in mind. But for investors who wish to get into the business of real estate investing, even on a limited basis, REITs can be a first step.
Let's face it – hosting an open house may seem like a major hassle. Cleaning a home and getting it ready for an open house could prove to be costly and time-consuming. Plus, despite your best efforts to prep for an open house, there are no guarantees that the event ultimately will help you sell your residence.
Although hosting an open house initially may seem difficult, the advantages of holding an open house generally outweigh the disadvantages. In fact, there are many reasons why you should host an open house, and these include:
1. You can gain a competitive edge.
The real estate market is fierce, especially for sellers who are competing against one another for buyers' attention. Fortunately, an open house can help you gain an advantage over the home selling competition, as it enables you to show off your residence to large groups of potential buyers in a short period of time.
When it comes to selling a home, it helps to explore any competitive advantage that you can get. And if you host an open house, you may boost your chances of differentiating your home from the competition and generating lots of interest in your residence.
2. You can make it easy for buyers to picture what life would be like if they purchase your home.
A detailed home listing can make a world of difference for buyers. Yet a home listing alone probably won't drive buyers to instantly submit an offer to purchase your residence. Thankfully, an open house provides buyers with a stress-free opportunity to check out your house and determine whether to proceed with an offer.
Of course, during an open house, buyers can picture what it would be like if they own your residence. And if buyers like what they see, it may be only a matter of time before you finalize a home sale following an open house.
3. You can increase the likelihood of a fast, profitable home sale.
As a seller, you should strive to promote your residence to as many potential buyers as possible. With an open house, you'll be able to do just that.
An open house makes it simple to showcase your residence to dozens of prospective buyers at the same time. Meanwhile, the event empowers buyers to learn about your residence and gain deep insights into the condition of your house. And if a buyer is impressed with your residence after an open house, the likelihood increases that an offer could come your way soon that leads to a fast, profitable home sale.
As you try to sell your house, you may want to hire a real estate agent too. A real estate agent knows the ins and outs of selling homes and can teach you everything you need to know about how to host a successful open house. Perhaps best of all, a real estate agent can help you achieve the optimal results at each stage of the home selling journey.
A successful home search enables you to discover your dream residence at a budget-friendly price. However, conducting a successful house search may be difficult, particularly for individuals who fail to prepare for the homebuying journey. Lucky for you, there are many things you can do to prevent problems as you search for your ideal home.
Now, let's take a look at three tips to help you complete a successful home search.
1. Refine Your Homebuying Criteria
Think about where you want to reside. That way, you can focus on available houses in your preferred cities and towns – something that will allow you to speed up your quest to find your dream home.
Also, consider your homebuying must-haves. If you have always wanted to own a house with a spacious backyard, for instance, you can hone your home search accordingly. On the other hand, if you require a home that features multiple bedrooms, you can search for a residence that matches your expectations.
2. Establish a Homebuying Budget
A homebuying budget is crucial because it helps you understand exactly how much you can spend on a house. If you get pre-approved for a mortgage, you can start your house search with a budget in hand.
Meet with a variety of banks and credit unions. Then, you can find out how different types of mortgages work and select a mortgage that complements your finances.
In addition, ask questions about home financing. Banks and credit unions are happy to help you make an informed mortgage selection. If you analyze your home financing options closely, you can choose a mortgage that will serve you well both now and in the future.
3. Collaborate with a Real Estate Agent
A real estate agent takes the guesswork out of a home search. In fact, he or she will go above and beyond the call of duty to ensure you can discover your ideal residence without delay.
Oftentimes, a real estate agent makes it easy for a homebuyer to find a terrific house at an affordable price. This housing market professional simplifies a home search and will keep you up to date about residences that match your property buying criteria. Plus, if you want to buy a home, a real estate agent will help you submit a competitive offer to purchase your ideal house any time you choose.
With a real estate agent at your side, you can streamline the home closing process as well. A real estate agent will help you finalize a house purchase and ensure you can move into your dream residence as soon as possible. Best of all, if you have any concerns leading up to a home closing, a real estate agent can respond to them right away.
As you get set to search for your dream home, you may want to start planning for the homebuying journey. Thanks to the aforementioned tips, you can prepare for the homebuying journey and boost the likelihood of quickly finding and acquiring your dream house.
When you want to buy a home, you know that good credit will be necessary. You may have heard some things about your credit score that just aren’t true. Read on to set the record straight on some of the most significant misconceptions about credit.
Checking Your Credit Only Gives You Knowledge
Checking your credit score or report will not lower your score. The only way checking a score is damaging to a credit score is in the form of credit inquiries. This is when a lender, employer, or other merchant checks your credit in order for you to either gain employment or open a new line of credit. You have the right to review your score without it being impacted.
You Shouldn’t Carry Balances
The best way to keep a high credit score is to use a credit card and pay the balance off in full each month. It’s a false belief that carrying a balance is an excellent way to increase your credit score. You need a low debt level to maintain a good credit score.
Your Age And Income Have Nothing To Do With Your Score
It’s natural that older people who have a longer credit history have a better shot a good credit score, but your age has nothing to do with your score. It all depends on when you established credit. Some people started their credit histories early because their parents opened accounts for them. Others needed to wait awhile before opening their first credit card account.
Your income also is not a factor in determining your credit score. It may be true that if you have a higher income, it’s easier to stay out of debt, but the amount of money you make has no direct impact on your score.
You Cannot Access Your Credit Score For Free
You have a legal right to obtain a free copy of your credit report once a year but, your credit score isn't included in this report. There are free services that are outside of your credit report that will give you your credit rating, but you need to search for them. It’s a good idea to check your credit report periodically, but you should also know your score especially if you're getting ready to make a big purchase such as buying a home.
Your Credit Matters More Than You Think
While you know your credit score matters when you head to get a home loan, you may not know just how many entities take your credit into account when you apply for them. Some things you may do where your credit score matters:
Apply for a job
Apply for a credit card
Rent an apartment
Sign up for phone and Internet services
Get other utilities in your home
Your credit history gives a picture to the world to let them know if you’re financially stressed. If you have gone through rough patches, there are always ways to bring your score up. If you had a judgment ruled against you in a lawsuit, for example, that would only appear on your credit report for a certain number of years. Lenders will often allow you to explain bumps in your credit report as well. Understanding credit is half the battle to a good score!