Tag: homebuyers

Real Estate, Tips & More

How to Save to Buy a House

Lupe Ruiz, REALTOR®/Broker

Depending on the type of loan you are applying for, you may need from 3% to 20% of the purchase price for a down payment. In addition to your down payment, you will also need around 2%-5% of the purchase price for closing costs. Once you know how much you can afford, you will be able to determine the amount you will need and how long it will take to achieve your goal. Here are some things you can do to achieve this goal:

1. Open a bank account that is specifically for saving money for your home purchase. This can be a savings or investment account. Set it so the transfer is done automatically every month and, no matter what, do not withdraw any money from that account.

2. You may also deposit any tax refund, extra money, or gifted money into the new account.

3. Reduce any current debt. Start by paying off any high-interest credit cards.

4. Do not get into any new debt whether it is a new credit card, a loan or a new car.

5. Cut down unnecessary expenses such as entertainment, eating out, and non-essentials.

In addition to this, you may also start a new side job and save this income. However, keep in mind it is recommended that before you start saving for your new home, you have an emergency fund already in place with at least three months of your monthly expenses. This will allow you to have a separate account in case of an emergency so you do not need to tap into your home purchase savings.

Featured image by Jeremy Bishop / Unsplash.com

Content image by Eskay Lim / Unsplash.com

Real Estate

Six Tips To Keep Yourself Organized When You Tour Homes

Lupe Ruiz, REALTOR®/Broker

Home buying can be fun and exciting but it could also be overwhelming.  Keeping yourself organized can give you more clarity and reduce some of the stress. Here are six tips to keep yourself organized when you tour homes.

Before you start your home search:

  • Know how much you can afford as well as how much you are willing and able to invest.
  • Write down what you must have in a house. For instance the number of bedrooms, bathrooms, location or sq. ft., etc.
  • Write down what you would like but is not a deal breaker. I would list these in order of preference in case there are multiple homes you like with different features from your list.

Once you begin your home search:

  • Take your “must have” checklist with you.
  • Write notes on each house (after seeing several in one day, you can forget which one had what features).
  • At the end of the home tours, write down the pros and cons of each and determine which have the features you must have vs. what you would be okay not having.

As you view more homes, you will find that your criteria might change along the way. Keeping yourself organized and having a professional real estate agent who is in sync with your needs will make the process a lot easier. You will find it easier to decide on a house and be more comfortable with your offer.

Real Estate

5 Steps To Prepare For Your First Home

Lupe Ruiz, REALTOR®/Broker

You would like to buy your first home but don’t know where to start? Here are five things you can start working on:

  1. Establish good credit – You can open a credit card and use it for small purchases you can afford to pay off at the end of the cycle. Or, get a secured credit card at your bank. With this type of credit card, you deposit your own money and only charge up to that amount. You can also ask someone with good credit to add you as an authorized user on one of their credit cards— but, most importantly, pay on time and do not max your cards (tip: use no more than 30% of your credit limit).
  2. Prepare to afford a house – As a general rule, your total housing expenses should not be more than 28% of your gross monthly income; and ALL monthly debt (including housing expenses) should not exceed 36% of your gross monthly income. Housing expenses include, the monthly principal and interest, property tax, homeowner’s insurance, and homeowner’s association (if applicable).
  3. Save, save, save – Down payments can be as low as 3%. In addition, you will have closing costs of around 2-3%. For example, if the price is $500,000, your down payment could be as low as $15,000 and your closing costs between $10,000-$15,000. You could potentially need around $30,000. You can also receive gifts to help with these costs and, depending on your credit, you may qualify for other down payment assistance programs. However, keep in mind that the higher your down payment, the lower your monthly mortgage payment will be.
  4. Crate an emergency fund – Have a separate account with funds you will not use unless it’s for unplanned expenses or other major emergencies. Ideally, this would be three to six months your monthly expenses.
  5. Plan a budget – Budget when you are saving to buy your house and when you buy your house. A budget will help you track bills and pay on time. Also, keep in mind that when you own a house you also have additional utility and maintenance expenses.

Buying a home for the first time can be scary. You might not know where to start. This is why it is so important that you work with a real estate professional who will guide you through the process. When you are ready to buy, get in touch with a real estate agent. They will refer you to someone who can pre-approve your loan and will get you started on your home search.

Real Estate

Is this a Good Time to Sell or Buy My Home?

Lupe Ruiz, REALTOR®/Broker

Volatile interest rates, inflation, and a reset in housing probably have you wondering if it is a good move to sell or buy your home right now.  Interest rates have been going up; housing prices are still at the highest they have ever been; and the media is announcing a housing crisis.

So, what now? Well, first of all, consider all the data before you listen to discouraging reports…there is a greater chance we will have a housing reset and not a housing crash. Secondly, determining whether or not it is a good time to make a move depends on your individual needs. Are you relocating? Are there health or financial reasons? Is there a life event? Or, are you simply tired of paying someone else’s mortgage?

Buyers — Yes, interest rates are higher than a few months ago. However, they will eventually go down again; and you can refinance to a lower rate. And, if the value were to go down (which is not expected any time soon); it will eventually go up again as well. If you are planning on living there long term and you can afford your mortgage payment; a change in value would not be relevant right now.

Sellers — Yes, if you sell now for a higher profit, your replacement home will also cost more than before the inflation creeped up on us. Nonetheless, consider that this is relative; and you can use the equity you gain from the sale as down payment on your new home. If you are concerned about closing and not having a replacement home, consider negotiating to stay some additional time after close of escrow.

I hope this helps to answer if it is a good time or not to make a move.  It might not be the right time to purchase an investment property. However, it could be the right time to buy your home. Your story is different from your neighbors’ so what is right for you, might not be right for them and vice versa.

Real Estate

Get Off the Fence Before It Is Too Late

Lupe Ruiz, REALTOR®/Broker

For those homebuyers who were waiting for the market to hit rock bottom; let me tell you it already did, and it is on its way back up. You may not find the same type of house you saw six months ago at the same price anymore…you’ll have to be realistic and, perhaps, even re-evaluate your search criteria. However, it is not too late.

Inventory is low but interest rates are also low. So as long as you make a strong offer, you should be in a good position. What is a strong offer? Well, there are various components to a strong offer but here are some that may be used in conjunction or independently depending on your individual case.

1) Large down payment
2) Large deposit
3) No loan contingency
4) No appraisal contingency
5) Not asking for any closing costs or other concessions

I wouldn’t recommend low balling in this market. Have your Realtor run a comparative analysis and offer your best price based on that. On the other hand, offering too high above market price doesn’t necessarily mean your offer will be accepted. The seller’s Realtor has also done a comparative analysis, and wouldn’t want to risk the deal going south when the appraisal comes in low. So, be strategic in your offer.

20130103-202107.jpg