Select Page

Home Buying

Personal Finance

 

Sponsored Content

 

steemit

Visit on Steemit!

Support us on Steemit!

bitcoinlgoo

Visit on D.Tube!

Support us on D.Tube!

Curriculum Content

 

Many people prefer to purchase their living space, for investment or living. The process of purchasing a home, condominium, or apartment is substantially different than renting.

You should see your potential home as a living space and as an investment. Viewing the home as an investment becomes more important as your planned time frame in the home shortens. If you will be selling the home a wiser financial approach will help increase your return on investment. Don’t simply buy the most expensive home you can afford.

Budget Planning

The actual purchasing process for a home is highly different than renting an apartment. Your first objective is narrowing your selection based on what you can afford. Be realistic about the house you can afford with your monthly income. Your monthly mortgage payment should be under 30% of your monthly income. The closer this number is to 20%, the safer your finances are. You should acquire the shortest possible mortgage you can afford while paying less than 30%. Use a mortgage payment calculator to get a rough estimate of your fixed rate monthly payments. Knowing the price, you can afford to pay monthly shows if you can afford to buy. It also eliminates homes you cannot afford.

Researching

Your prospective neighborhood should have multiple residencies in your price range. Researching and exploring each prospective neighborhood is essential. Examine the neighborhood’s crime rate, educational quality, local entertainment, and shopping opportunities. Be sure to look up average response times or locate nearby hospitals, police stations, and fire departments. Drive around the neighborhood during day and night to get a proper feel for the area. Stop local residents and ask them how they safe, secure, prosperous, and entertained they feel in that specific area.

There are two options to purchasing your home that can be considered. The first is purchasing a new or custom built home. The second is buying a used home. Each option has different economic factors.

Purchasing a new home or building a custom home almost always costs more for the same amount of space. You pay the costs and earnings of everyone involved in building the home. Worse, your new house becomes used the instant you move in, like a car. Your home may need to be priced below any equal new homes built around you to sell. If you have to sell, you’ll lose the difference between the price you paid and the price required to sell the home. You would suffer losses due to commissions and marketing costs, even if you sold the house at the same price. Most importantly, if the housing market flatlines or prices sink you suffer even more at the sale.

Older homes won’t come customized or have the “new home” ego factor but they have economic advantages of their own. People selling old homes are price capped by new homes in the area. Your payment for an older home is limited, even if owners have built value into the home. You can use this to negotiate for a cheaper price, citing renovations or replacements. Many sellers have personal situations that require a quick sale. If the seller needs to move or is avoiding a foreclosure, use it to your advantage and negotiate lower pricing.

Real Estate Agents

You can find a real estate agent to help you locate a home, or you can look yourself. Most times you’ll have no actual choice. There are many things you should know about the agents you will work with. Almost all brokers earn their income from the 6% closing commission paid from the price on the home. You must buy the living space for them to earn a profit. Their earnings are subtracted from the price paid by the house. Many sellers would happily keep the 6% commission they pay the broker. Brokers know this, and preference the seller over the buyer. Make sure a broker you hire specifically prioritizes you over sellers.

Determine who you’re dealing with before you ask the broker to show you listings. Look at reviews and references before selecting a guide to the local market. Also, make sure they know what you want when dealing with you. Be very specific about every detail and preference you have for your home. This reduces the frustration level of both parties and sets clear expectations. Realism from both parties helps close deals.

Your broker should actually be your guide. They should be willing to tap multiple connections for showings and tours. They should be extremely knowledgeable about price averages for homes, and what specific aspects make the homes more or less expensive than other homes in the immediate area. They should also be willing to assist with paperwork and an offer. A broker that will not do these is not acting for you.

Negotiation

The success of negotiation depends on you being prepared. You should always attempt to pre-qualify for a mortgage with a predictable monthly payment between 20% and 30% of your annual income. Pre-qualifying for a mortgage has several positive effects. It shows the broker and the seller that you are serious about purchasing a home. It removes the pressure of finding a loan during your negotiation. Finally, it forces you to focus on what you can afford financially and reduces mistakes arising from emotional attachment.

Never show any emotional attachment to a home. At any point, displaying an emotional desire to own a home gives the seller power in negotiations. Always display a willingness to walk away. If the home is not highly desired, open offering well below the market price and see if the owner bites.  If they bite, you get the house on the cheap. If they do not, raise your offer or move on. As a buyer, you can always raise your offer but you can almost never lower it. Repeat this process with every home on your list. Your counter offers may be surprising.

Inspection

If you have an acceptable offer on a house, hire an independent contractor to investigate potential problems. If the investigators find issues or problems, reduce your offer by the costs of replacements or repair. If owners are willing to repair it themselves, your offer can remain the same. This will save you money versus fixing these problems yourself.

Payment

The final steps are paying the down payment, which should be twenty percent or more of the home’s value. The preferred amount is over 40% of the home’s value. The final step is signing paperwork. Note that you may pay several fees here. You will typically be charged for processing fees, mortgage-related service charges, and prorated property taxes. You’ll also encounter title insurance, which insures against defects in titles due to liens or defects. You will finish by acquiring the checks from your financing company and paying the down payment.

Did we help you? Vote with a Crypto-Donation!
steemit

Visit on Steemit!

Support us on Steemit!

bitcoinlgoo

Donate Bitcoin

141FSmuHkMSZVsQQtE9GHSPyj6gAonqqWR

bitcoinlgoo

Donate Dash

Xr4fdtP78Mh3gnVwAUjjuZRCq3kubaHZ5o

bitcoinlgoo

Donate Litecoin

LcrxGsshB2j9SddnZNdLfYMsDqAtw3Dr9v

bitcoinlgoo

Donate Iota

LXIVNBVHRYBOHRWNGMBNHOYMT9GBEFTPQMKDUZUYYHGMPXOOEYETMUQZXWXCGWBMTFERLW9LMCKNUDCKAMDOQCNDNZ

bitcoinlgoo

Visit on D.Tube!

Support us on D.Tube!

bitcoinlgoo

Donate Bitcoin Cash

14NCVeGCZfHf7tiy9N2Yz1mrBNi9m2mQ4S

bitcoinlgoo

Donate Ethereum

0xAF7d66B09F34833Ccec1Ed9e4D356D40c09698e5

bitcoinlgoo

Donate Ripple

raiZ2rCXLeBTUh2A4voKALZpMxQ88KxZxm

bitcoinlgoo

Donate Monero

42byh9AjzB3XXRptSeSfzAGC588HRZgVXAGMay6yYKjjAHinUxdQkxw3Ay1XcziXV86XY57aRqG5kGnJ8LFWmSjmAnUEnYh

International Economic Analysis:

  • Major Currency Economic Summaries
  • Performance of Major Imports and Exports
  • Mandates of Central Banks versus Expectations
  • Performance Indexes of Major Economies
  • Economically Correlated Currency Projections
  • Large Funds Currency Sentiment Readings
  • List of Technical Indicators to Look For
  • Occasional: Foregin Exchange Technicals Markups

American Markets Analysis:

  • Summaries of American Economic Structure
  • Performance of Major
  • Imports/Exports
  • Federal Reserve Mandate versus Expectations
  • Performance Indexes of U.S Economy
  • Economically Correlated U.S Dollar Projections
  • Large Trading Fund Index Sentiment Readings
  • Market Wide Earnings Versus Valuations
  • Fundamental Ranking of U.S Business Sectors
  • Best and Worst Future Consensus Estimates
  • Occasional: Firm Fundamental Strength Report
  • List of Technicals to Look for While Trading

WealthCE FX + Equity Analysis

Major 8 Economic Summaries
Economic Performance Index
Currency Market Sentiment
Equity Index Market Sentiment
Sector Strength Tracking
Equity EPS/PEG Estimates
Fundamental Firm Analysis
Trend Following Trading Plans

Robinhood is a SEC, FINRA, & SIPC member brokerage that lets you to buy and sell U.S. stocks/ETFS with ZERO commission. Sign up and get a free stock!

coinbase

Coinbase is a digital brokerage specializing in currencies. They allow you to trade US Dollars and Euros for Bitcoin, Bitcoin Cash, Ethereum, and Litecoin.

coinbase

MyFxChoice is a regulated brokerage offering 200:1 Leverage on Foreign Exchange, Gold, and Silver. They offer 33:1 on Crude oils and up to 50:1 on equity indices like the FTSE100, DAX30, S&P500, and Nikkei.

Forex Tester 3 is a technical analysis back testing and simulated trading platform that serves as a testing platform for trading strategies.

Ledger Nano S - The secure hardware wallet

Sponsored Content