The U.S. economy is improving and so is the real estate market. As millennials in particularbegin to buy their first homes, they are experiencing first hand that there is a definite learning curve to the process.
Local Reno-Sparks realtors Regina Lockwood and Jim Forbus have contributed their expertise to offer novice homebuyers some advice.
The "Home is Possible" grant offers qualified Nevadan homebuyers in Washoe and Clark Counties 4 percent of their loan amount to cover their down payment and closing costs. The grant doesn't need to be repaid. Program requirements include:
•A minimum credit score of 640 for government insured loans, 660 for manufactured homes and 680 for most conventional loans.
•Qualifying income on mortgage application must be below $95,500.
•Home price below $400,000
•Applicants must take a homebuyer education course.
•Must meet normal government or conventional loan underwriting requirements.
2. Make your mortgage interest work for you
Another route to consider is getting a mortgage credit certificate. Issued by the local government, a mortgage credit certificate allows a homebuyer to claim a tax credit for their mortgage interest. It increases buying power for first-time homebuyers, but it does cost some money up front.
3. Don't forget about unpaid medical bills
Approximately 30 percent of millennials have unpaid medical bills, according toa 2014 reportby the Financial Industry Regulatory Authority.
"A lot of first-time homebuyers need to take care of any unpaid medical bills. Collections can really get you, and emergency room bills will come back to haunt you when you're trying to buy a house," Lockwood said.
4. Make sure you have enough lines of credit
"Some people don't want to do anything with credit and just pay cash instead," Lockwood said. "But to buy a house you typically have to have three revolving credit lines (i.e. credit cards)."
For people who are hesitant to open credit cards or can't get one yet due to lack of credit, there is a solution. Some banks offer a card with a secured line of credit to their customers. A customer can give the bank a certain amount of money, say, $500, and the bank will give him or her a credit card with a $500 limit.
"If you've never had credit, that's a way to start," Lockwood said.
5. Select a trustworthy agent who understands your needs
Every homebuyer is different, and your realtor's way of doing business should reflect that. Forbus, a realtor with Krch Realty in the Reno-Sparks area, completes an "All About You" form for his prospective clients to get a better understanding of what they're looking for.
"Buyers and real estate agents should have mutual trust and commitment to one another," Forbus said. "Buyers may decide to break commitment if they feel the agent is placing them or their funds at risk."
6. Don't forget about closing costs
Closing costs will account for a significant portion of the total sale, and a failure to plan for them can result in not getting the house you want.
"Buyers can enhance their buying leverage by possessing the funds to cover their closing costs, or obtain a gift letter from a relative to cover their closing costs," said Forbus.
7. Search the internet wisely
Real estate search engines likeTruliaorZillowcan give you a good idea of what's available on the housing market, but some sites aren't as up-to-date as others.
"Buyers should follow the agent's advice as to real estate search sites and understand some websites offer limited or teaser information," Forbus said.
8. Think long-term
A house is an investment, so don't rush into buying one that doesn't meet your standards.
"Buyers in the Northern Nevada area should consider a home that they would be satisfied with for 6-7 years," Forbus said "It may be best for some buyers to save more funds and purchase a better quality home or area rather than to rush into an immediate purchase."
Author:Mona Thind Phone: 803-269-4774 Dated: April 8th 2015 Views: 371 About Mona: ...
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