Take Charge When Buying a Home

If you approach the home buying process intelligently and with confidence, you are much more likely to emerge with a house you'll be proud to call home.

Approaching the task of buying your next home can be overwhelming. There's so much to consider.

How much house can I afford, and how can I find the best loan? Where will I come up with a down payment, and how much will I need? Should I buy a new or resale home, and which will go up in value? Should I use an agent or look at homes on my own?

And these questions are just the beginning. Buying a home is one of the largest financial transactions in your lifetime, yet we don't teach about it in school. You're just supposed to pick it up along the way.

Well, as you start down this road, let me give you a little advice. Here are the two most important things to remember no matter where you are on the road to ownership:

1. You can and should understand everything that is happening in the home buying process. There is nothing, and I mean nothing, that is so complex that it can't be easily explained to anyone with average intelligence, and you've got more than that. Just because we don't apply for a thirty year mortgage once a week doesn't mean we have to take the first one that comes along. You'll need to learn some new terms, apply some new concepts and take the time to understand what you're getting into. If anything happens at any point in the process that doesn't make sense to you, simply demand a full and complete explanation. If it still doesn't make sense, seek help from someone you trust like your CPA, your banker or maybe your friendly online real estate columnist.

2. In the world of real estate sales, YOU are the most important person in the entire process. It's easy to think that everyone else carries more weight than you. The agent talks fast and has an answer for everything. The lender may decline your loan application, and on and on. But the truth is that you, the buyer, are the one person in this transaction that makes it all happen. If you decide to not buy, the entire process comes to a grinding halt. So flex your consumer muscle and take command of this process. Surround yourself with a team of professionals that you have confidence in and make them work for you.

If you plan from the beginning to approach the home buying process intelligently and with confidence, you are much more likely to emerge at the end of the day with a house you'll be proud to call home, and the knowledge that you made the right decision.

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Buying A Home Plan for Younger People – Make Sure to Plan Ahead

Granted, few young people spend much time day-dreaming about buying their first home. They're naturally preoccupied with academics, athletics, parties, dating and future career possibilities. Nonetheless, there are a number of good reasons to start learning early in life about the costs of buying a home and the responsibilities of homeownership. For example, a college student's misuse or abuse of credit cards can preclude his or her buying a home later on.

Here are five recommendations for young people who want to position themselves for homeownership:

1. Establish good credit habits and a favorable credit history. Get a credit card and use it responsibly. Apply for an automobile loan and make your payments on time every month. If you're renting an apartment, put your own name on the lease and the utility bills and make sure the rent and the bills are paid every month. If you're already struggling with credit card debt or have large student loans, take a free workshop from the non-profit Consumer Credit Counseling Service. Call (800) 388-2227 for information.

2. Start saving for a down payment and closing costs. It's possible to purchase a first home in many parts of the country without much in the way of savings. But in high-cost housing areas, starting to save early can be enormously beneficial because you'll get the advantage of compounding interest and have a longer period of time to grow your investments. Open a savings account or a stock brokerage investment account and make regular deposits.

3. Read some books. Your local library and bookstore probably have at least a few shelves of books about financial management and buying a home. Take notes. Make a financial plan for yourself.

4. Research where you'd like to live. Many young people assume they'll continue living in their own home town when they get older, but people are more mobile than ever and chances are good you'll one day live in another city or even another state. Again, the library, bookstore and Web can be excellent resources for information about housing costs and homeownership opportunities around the country.

5. Tap your real estate agent relatives for advice. Parents, grandparents, aunts, uncles or older cousins in the real estate business can give you good information about the cost of housing in the area where you want to live and what it takes to buy a home. Questions to ask: Is housing affordable in this area? How much money would I need to save in order to buy a home? What advice would you give me about planning my financial future? Would you recommend some books that I might like to read about buying a home? Don't be shy. If you have a question, ask someone in a position to know the answer.

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