Seattle Real Estate BlogRecently posted or modified blog postshttps://www.realexpertsrealty.com/blog/Copyright RealExpertsRealty.com2020-08-29T10:25:21-07:00tag:realexpertsrealty.com,2012-09-20:4120How to Buy a HomeHow to Buy a Home
Have you decided it’s time to buy a home? Maybe you’re tired of renting or you know you’ve saved enough money to take the plunge.
No matter what stage you’re in, you must take the necessary steps to buy a home. It’s not as hard or overwhelming as it seems!
We’ve broken down the steps for you below.
Are you Ready to Buy a Home?
You’ve decided you’re ready to buy a home, but do your finances agree? This is the time to get honest with yourself and take a long, hard look at your finances. Buying a home is one of the largest investments you’ll make in your lifetime and you carry a mortgage for 15 – 30 years.
You’ll know that you’re ready when you’ve done the following:
Saved for a Down Payment
Ideally, you should have a 20 percent down payment. Millions of homebuyers don’t, though, and that’s okay. Many loan programs offer other options, including the FHA and conventional loans which require a 3.5 percent and 3 percent down payment accordingly.
On top of your down payment, you’ll need money for closing costs. Anticipate between 3 and 5 percent for closing costs. This covers the loan costs, title fees, attorney fees, and all loan closing costs.
Fixed your Credit
You don’t need perfect credit to buy a home, but you must prove you can handle your finances. Conventional lenders require a higher credit score, but they also offer the best rates and terms. If you don’t qualify for a conventional loan, which requires, on average, a 680 credit score, there are other options.
FHA loans, which are the most common conventional loan alternatives, require only a 580 credit score. However, the higher your credit score is, the better rates and terms you get.
If you aren’t sure what your credit looks like pull your free credit report here. You won’t get your score, but you’ll see your credit history. You can pull these reports weekly for free until April 2021. As you look through your report, look for:
Late payments that you need to bring current
Credit balances that exceed 30 percent of your credit line
Unpaid collections
Accounts reporting incorrectly or that aren’t yours
If you find incorrect information, you can file a dispute with the appropriate credit bureau. They have 30 days to respond to your request.
If you have late payments or you overextended your credit line, fix these issues as early as possible. The more time you give your credit score to increase, the better your chances of securing a better loan.
Have your Income in Order
Your income determines a lot too. After lenders approve your credit score, they want to see that you can afford the loan.
They calculate your debt-to-income ratio. This compares your total monthly debts to your gross monthly income (income before taxes). The ‘ideal’ DTI is 36 percent, but lenders realize not everyone can achieve a DTI that low.
At the most, your debts should take up less than 43 percent of your gross monthly income. This includes:
New housing payment including the principal, interest, taxes, homeowner’s insurance, and mortgage insurance
Minimum credit card payments
Installment loan payments
Any other monthly obligations that show on your credit report
Lenders also look closely at your income when you buy a home. They look for reliability and stability over the last 2 years. If you changed jobs within that time, they may question your new job. Is it in the same industry? Are you making around the same amount of money?
If you have gaps in employment or other questionable income issues, lenders may dig deeper to determine if you can afford it.
Get Pre-Approved
Once you get your finances and credit in order and you’re ready to look at homes for sale on a real estate website, it’s time to get pre-approved.
A pre-approval is different from a pre-qualification, so don’t confuse the two. A pre-qualification is just an estimate of what you can afford; it’s not based on any proof.
A pre-approval, on the other hand, is an underwritten approval of your qualifying factors. Lenders pull your credit and look at your income, employment, and asset documentation to determine if you qualify.
If you do qualify, you’ll receive a pre-approval letter. It’s a good idea to get this before you look at homes for sale. Today, many sellers and real estate agents won’t let you see a home unless you have one. The pre-approval letter lets sellers know that you’re a serious buyer and that you can obtain the necessary financing.
Decide if you Want a Real Estate Agent
With your pre-approval letter in hand, you’re ready to look at homes. Now it’s up to you to decide if you want to use a real estate agent. As a buyer, there’s no cost to you. Sellers pay the full commission cost.
You may have a little more wiggle room when negotiating the price of the home if there’s no agent involved, but you’ll often have access to more homes when you use one. Plus, real estate agents are professionals at negotiating the deal and navigating the sales process for you.
If you’ll use a real estate agent, start interviewing them right away. It’s best to talk with at least three agents so you choose the one best suited for you.
Look at Homes for Sale on a Real Estate Website
While you decide whether or not to use a real estate agent, you can peruse homes for sale on a real estate website. Zillow.com, Realtor.com or <a href="http://www.realexpertsrealty.com">Real ExpertsRealty.com</a> if your local to Washignton State. If you want access to the MLS listings, though, you’ll need to hire a real estate agent.
Choose a Home and Make an Offer
Now the fun begins! You can shop for a home. This is when knowing how to buy a home comes in handy. You must have all your ducks in a row, especially the pre-approval letter.
I suggest that you have a list of features you require in a home. If you have a list of ‘must-haves’ and ‘would be nice’ features, you’ll know right away which homes are off the table and which may be a good fit.
Shopping for a home is overwhelming, so the easier you can make it on yourself, the better! Once you find your ‘dream home’ you’ll make an offer. Your offer must be in line with what you can afford according to your pre-approval letter.
If you use a real estate agent, this is where he/she can help get you through the negotiating process. Sellers look not only at the price you bid, but at the other requirements you place on the contract, including the closing date, the contingencies you need, and the earnest money you’ll put down.
Once the seller accepts your bid, whether he/she does so right away or after negotiations, the clock starts ticking.
Get a Home Inspection and Finalize Underwriting
After the seller accepts your bid, submit the executed contract to the underwriter right away. The lender will then order an appraisal and get the title search going. Both of these play a big role in your approval and they take a few weeks to complete.
In the meantime, you should consider paying for a home inspection. This is different than an appraisal and lenders don’t require it, but highly recommend it. An inspector looks at all areas of the home, writing up a report on the home’s condition, what needs fixing, and what may need fixing soon. This is more in-depth than what the appraiser looks for, so it’s important that you take this step to avoid buying a home that’s not in good condition.
If the underwriter needs any additional information, he/she will ask during this phase. You may need to provide additional income or asset documentation. The underwriter may also have questions about certain factors that you need to clear up.
Close on your New Home
Once the underwriter clears your loan to close, this means the home passed the appraisal and the title work is clear (there aren’t any liens). Your final step is to review your Closing Statement, which you receive 3 days before the closing and to close on the loan.
Are you Ready to Buy a Home?
It sounds like a lot and to some it may seem overwhelming, but knowing when you’re ready to buy a home is important.
You want to make sure you are getting the best financing possible, which is only available if you do the legwork. Work on your credit, save for a down payment, and make sure you’re pre-approved before you look at homes. With everything together, you’re able to have a much simpler process that leads you to the home of your dreams2020-08-28T10:45:00-07:002020-08-29T10:25:21-07:00Royal Omoladetag:realexpertsrealty.com,2012-09-20:4074Auburn real estate agents Royal Omolade a 2019 Top 2% Agent out of 50,000 according to Berkshire Hathway home Service NW.
Royal's Company name is called: Real Experts Realty located at 2020 A street Se Auburn and his plan as a real estate Agent is to serve the local community.
Royal has been a real estate agent in Auburn for over 20 years and also resides in the local community. Being a certified WA State Real Estate instructor set him apart from majority of real estate agent in Auburn and the State.
2020-08-16T15:11:00-07:002020-08-28T18:23:11-07:00Royal Omoladetag:realexpertsrealty.com,2012-09-20:3060King and Pierce County Dog Parks <img src="https://assets.site-static.com/userfiles/1813/image/Dog_Parks_j.jpg" width="421" height="378" alt="Dog Park" />
SOUTH END DOG PARKS
Dawson Playfeild
1605-90th St E, Tacoma, WA
Cedar River Off Leash Park
1500 Houser Way S, Renton, WA
Chambers Bay Off Leash Park
6320 Grandview Dr W, Tacoma, WA
Clarks Creek Dog Park
1710 12th Ave SW, Puyallup, WA
Foothills Trail (East Puyallup Trailhead)
13902 80th St in E, Puyallup
Fort Steilcoom Park Off Leash Area
8714 87th Ave SW, Lakewood, WA
French Lake Dog Park
31531 1st Ave S, Federal Way, WA
Frontier Park
21718 Merdian E, Graham, WA
Gonyea Playfield
13422 10th Ave S, Tacoma, WA
Grandview Park Off Leash Park
3507 S 228th St, SeaTac, WA
Lake Tapps Park
2022 198th Ave E, Bonney Lake, WA
McCormick Forest Park
10301 Bujacich Rd NW, Gig Harbor, WA
Meridian Habitat Park
14422 Meridian E, Puyallup, WA
McKinley Park Off Leash Dog Area
907 Upper Park St, Tacoma, WA
Morrill Meadows Off Leash Park
10600 SE 248th St, Kent, WA
Point Defiance Park Off Leash Area
5400 N Pearl St, Tacoma, WA
Rogers Dog Park
3151 E L St, Tacoma, WA
Seeley Lake Park
9200 Lakewood Dr SW, Lakewood, WA
Spanaway Lake Park
14905 Bresemann Blvd S, Spanaway, WA
South Hill Community Park
14201 86th Ave E, Puyallup, WA
Tubby's Trail Dog Park
1701 14th Ave NW, Gig Harbor, WA
Viking Park Off Leash Dog Park
18902 82nd St E, Bonney Lake, WA
Wapato Park
6500 S Sheridan Ave, Tacome, WA
2020-03-20T13:36:00-07:002020-07-10T07:27:20-07:00Royal Omoladetag:realexpertsrealty.com,2012-09-20:3059Hiking Trails<img src="https://assets.site-static.com/userfiles/1813/image/Hiking.jpg" width="3000" height="2001" alt="Hiking " />
PNW Hiking Trails Around The Sound
EASY HIKES
Franklin Trails - 2 miles - Near Snoqualmie Pass
Beaver Lake Trail - 1.9 miles - Near Snoqualmie
Snoqualmie Falls Trail - 1.3 miles - Near Snoqualmie
Wallace Falls Trails - 4.4 miles - Near Gold Bar
Discovery Park - 4.4 miles - Near Seattle
Coal Creek Trail - 5.1 miles - Near Renton
Naches Peak Loop Trail - 3.3 miles - Near Ashford on Mt. Rainier
Silver Falls Trail - 4 miles - Near Randle on Mt. Rainier
MODERATE HIKES
Rattlesnake Ledge Trail - 5.1 miles - Near North Bend
Snow Lake Trail - 6.4 miles - Near Snoqualmie Pass
Tolmie Peak Trail - 5.5 miles - Near Ashford on Mt Rainier
Annette Lake Trail - 8.4 miles - Near North Bend on Mt Baker
Poo-Poo Point Trail - 7.2 miles Near Issaquah
South Beach and Hidden Valley Loop Trail - 2.4 miles - Near Seattle
Swan Creek Trail - 3.7 miles - Near Tacoma
Narada Falls Trail - 2.4 miles - Near Paradise Inn on Mt Rainier
HARD HIKES
Wonderland Trail - 15.3 miles - Near Orting on Mt Rainier
Cal Magnusson - 1.7 miles - Near Enumclaw
Mt. Si Trail - 7.9 miles - Near North Bend
Granite Mountain Trail - 8.1 miles - Near North Bend on Mt Baker
Tiger Mountain Trail - 11.8 miles - Near Issaquah
Skyline Trail - 5.3 miles - Near Parardise Inn on Mt Rainier
2020-03-20T12:19:00-07:002020-07-10T07:27:33-07:00Royal Omoladetag:realexpertsrealty.com,2012-09-20:2487Is Getting a Home Mortgage Still Too Difficult?<img src="https://assets.site-static.com/userfiles/1813/image/getting-a-home-mortgage.jpg" alt="Is Getting a Home Mortgage Still Too Difficult?" title="Is Getting a Home Mortgage Still Too Difficult?" height="410" width="750" />
Potential homebuyers are always cautioned to be aware of mortgage lending standards and the difficulty they might face when trying to obtain a mortgage. Credit availability is expanding, making it easier to get a mortgage now than it was a year ago. The market is still tight however, and homebuyers should be prepared to shop around until they find a lender who is offering something that will meet the needs of their family.
Mortgage lending companies have high standards so it is important to make sure you and anyone else who will be included on the mortgage have their credit in check. The mortgage market is strict because lenders do not want to be put in a situation where they are forced to repurchase loans that are not paid on. They also do not want to end up in a litigation situation due to loan issues.
What Has Happened to the Number of Mortgages?
Due to the strict nature and requirements of the lending companies, the number of mortgages given out has significantly dropped. A report by the Housing Financial Policy Center at the Urban Institute showed that about 6.3 million fewer mortgages were given out between 2009 and 2015. The reasons behind this statistic are strict regulations and policies. These mortgages would have been granted if the lending standards where more reasonable.
Mortgage companies rely on calculations to determine if a home buyer will become delinquent on their payment. They will not give you a loan if you are too much of a risk for them. Credit history has a huge impact on this decision since lenders can see how often you pay back your debts. The history they receive is extensive. This view into your financial past causes lenders to take less risk when lending to you for your mortgage.
The Effect on the Economy
The housing market is recovering at a slower pace than it should since less potential homebuyers are being offered loans. While the market is still recovering with positive trends, fewer buyers can create a strain on other economic factors like home goods or construction jobs. Bottom Line
After the housing market boom and bust, mortgage lenders became stricter in their lending standards. It is not impossible to get a mortgage loan, but it can still be difficult for potential home buyers. Stay on top of your credit and make sure you and anyone else who is applying are in a good financial position so you can be approved for a loan. It is important to research different companies and their requirements to ensure success in getting a mortgage.2020-01-02T13:46:00-07:002020-01-02T13:48:55-07:00Royal Omoladetag:realexpertsrealty.com,2012-09-20:2486Why You Should Consider Selling in the Winter<img src="https://assets.site-static.com/userfiles/1813/image/selling-in-the-winter-attracts-serious-buyers.jpg" alt="Selling In Winter Attracts Serious Buyers" title="Selling In Winter Attracts Serious Buyers" height="410" width="750" />
The season you sell your home can have an impact on how much you get for your home and how quickly it sells. The season that has the most success in selling homes is spring. This is a good time of year for families moving to new school districts and is also more convenient weather for moving. Because of this trend, most people will recommend waiting to list your home until after the winter is over. Avoiding the winter is a huge misconception in the housing industry and can cause homeowners to miss out on opportunities.
Selling in the winter can give you a few advantages. There will be fewer houses on the market since most people assume winter is a bad time to sell. This gives your home more attention. Potential buyers are always looking no matter the time of year. Keeping your house on the market in the winter might bring the right buyer to your door. Real estate agents also tend to be less busy during these months and commit more time to getting your home sold.
Studies have shown winter buyers are buying because they need to move right away either for a relocation or personal situation. They will want to close quickly and allow for a much smoother sale.
Bottom Line
If you need to sell your home right away, or have some time but want to see what is out there, consider listing in the winter. Most homeowners who are going to sell will list their home in the spring, making for a competitive market. The winter allows buyers who are in a hurry to move consider your home and sell for more money than you would have in the spring.2020-01-02T13:46:00-07:002020-01-02T13:49:07-07:00Royal Omoladetag:realexpertsrealty.com,2012-09-20:2485Common Things to Look Out for Before Buying Your Dream Home<img src="https://assets.site-static.com/userfiles/1813/image/3-questions-to-ask-before-buying-your-dream-home.jpg" alt="Common Things to Look Out for Before Buying Your Dream Home" title="Common Things to Look Out for Before Buying Your Dream Home" height="410" width="750" />
It is easy to become overwhelmed when you enter the home buying market. Friends, family, colleagues, and even acquaintances will give you their opinions if you are a first time home buyer. While most of them are looking out for your best interest, they are not fully aware of what is happening in the housing market.
It is important for you to be prepared and have your own questions ready. No matter what other opinions you are getting, you are the one buying the home and your comfort level will help make your final decision. Here are three important questions to ask before you purchase a home.
1. Why am I Buying a Home?
Regardless of the finances, it is important to think about what made you want to buy a home in the first place. Usually the reasons don’t have to do with money. Instead, home buyers are focused on how the house will impact their family in the future. A study done by the Joint Center for House Studies at Harvard found there are four reasons people buy a home. Those reasons include schools for your children, a safe environment, more room for your family to grow, and control of your own space.
These factors are the most common reasons people look to buy a new home. When you ask yourself why you are looking to purchase a home, do any of those factors come up? Spend time with your spouse or family members who are involved in this decision and determine why you want a home in the first place. Creating this list will help when searching for a home and can help your real estate agent find the best home for your needs.
2. What is the Trend with Home Values?
Our current economy and housing market is strong. That means home values and mortgage rates are increasing. If you are looking to purchase a home but want to stay within a budget, it may be in your best interest to move quickly. It is forecasted for these trends to continue in an upward motion, causing home values to continue to increase.
3. What About Current Mortgage Rates?
The ticket price is not the only thing you should be concerned with when purchasing a home. Mortgage rates are always changing and can have a huge impact on your monthly payments. Current trends show mortgage rates are rising. This is something to consider if you are debating the right time to purchase a home, since the rates may be even higher down the road.
Bottom Line
You and your family are the only ones who can determine the right time to purchase your dream home. It is important to decide exactly why you want a new home for your family and decide on a budget that will be comfortable moving forward. This budget may affect the amount of time you have to search for a home, since home prices and mortgage rates are increasing. 2020-01-02T13:46:00-07:002020-01-02T13:49:01-07:00Royal Omoladetag:realexpertsrealty.com,2012-09-20:2484Will Increasing Mortgage Rates Impact Home Prices?<img src="https://assets.site-static.com/userfiles/1813/image/mortgage-rate-projections.jpg" alt="Will Increasing Mortgage Rates Impact Home Prices? " title="Will Increasing Mortgage Rates Impact Home Prices? " height="410" width="750" />
There has been some discussion recently on home prices in relation to mortgage rates. Some believe if there is a rapid rise of mortgage rates, home prices should decrease. Logically it makes the most sense for the price of the house to drop when interest rates are rising, but this is not always the case.
This theory of home prices decreasing is typically discussed by future home buyers. As a buyer you would like to think if you are paying higher rates on your mortgage, you should be able to see a decrease in cost somewhere else. Unfortunately, these rates are rising because the economy is in better shape. As the economy succeeds, incomes rise, rates go up, as well as the price of the home.
A recent study by the John Burns Real Estate Consulting found mortgage rates have very little impact on the cost of the home. The housing market and price increases are affected by things like job growth in the area and rising wages. Coincidentally, these same factors are causing the rise in the mortgage rates since people can afford to take out more.
Bottom Line
As the economy progresses and strengthens, mortgage rates and home prices will fluctuate. It is a misconception as rates increase, home prices will decrease. Advances in the economy have shown that rates and home prices are more likely to increase together.2020-01-02T13:46:00-07:002020-01-02T13:48:58-07:00Royal Omolade