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What are the steps on buying your first home?

So I'm 22 years old, I'm getting married in September, I'm almost done college, and I'm starting work in March. My fiance and I are planning to rent for now but we wanna know what we need to get to start looking for our first home. We live in Philadelphia, PA.  
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February 02 - Philadelphia
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Time to get your financial ducks/docs in a row!  Job income verification needs to be proved out and verified.  Keep pay stubs and w2's handy.  CREDIT should be analyzed to see where you stand as a 760 score means significantly more than a 680 score now then it did years ago.  We can get you started with a pre-approval which will tell a realtor/seller the amount of money you can obtain.  Also, talk to a realtor in the area you are looking at to get a feel for what kind of home and what those are selling for now.  Save money, save money!!!  We can help! 
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March 20
Congratulations on all the great new changes in your life first and foremost! As you begin your own search, your best bet is to find a licensed agent to help. Figure out your financials and how much you can afford to have a downpayment. Keep in mind that you need to be pre-approved so I recommend pursuing that as you search being that it could take 4-6 days for a pre-approval depending on how fast you can submit your paperwork to the lender, etc. Goooooood luck!!!
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March 20
Great question, you're on the right path. CNN Money highlighted Philly as a city where it makes sense to own vs rent, with the home basically paying for itself in 3 years! I'm hosting  [Promotion and hotlink removed by Zillow moderator. Please see our Good Neighbor Policy.]
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March 20
Feel free to refer to my buyers guide at www.soldbylouisa.com/guides/buyers Also noted below...

Buyer Checklist

  • Evaluate your budget – know what you want to spend for a down payment as well as monthly expenditures (i.e.; maintenance or common charges and real estate taxes, monthly mortgage payment, utilities, parking, etc.)
  • Obtain mortgage pre-approval
  • Prioritize your needs – space, light, views, building amenities, etc.
  • Identify your timeline for moving
  • Explore different neighborhoods to identify your preferred needs
  • Research schools in the selected neighborhood(s)
  • Evaluate access to transportation in the selected neighborhood(s)
  • Evaluate complex amenities and HOA rules in terms of your needs (i.e.; washer/dryer permitted, gym in building, pet policy, storage facilities, etc.)
  • Work closely with your real estate agent to gather support materials for you mortgage application

Purchasing Process

  1. Seek pre-approval for a mortgage: Typical time frame: 1 – 2 days. You must know how much you can spend before you spend it.
  2. Find a home: Typical time frame: 1 week – 2 months. Touring houses for sale is one of the most enjoyable steps in buying a home. With the help of Louisa you can save time by limiting your search to homes that meet your financial and personal criteria. Depending on what you are looking for, the length of your search will vary. The average person sees 20 – 25 homes before deciding on one. Internet-savvy buyers save time by doing their ‘homework' before their search. The average number of homes viewed before buying by our Internet buyers is 4 – 5.
  3. Make an offer: Typical time frame: 2 days – 1 week. Generally, in a sales transaction, a California real estate agent represents each buyer and seller. In California, making an offer on a home does not automatically obligate a buyer to purchase. Included in the offer are contingencies such as that the title to the home must be clear and the home must pass inspection by a licensed inspector. Louisa will assist you in making the most reasonable offer, based on his knowledge of the current real estate market.
  4. Negotiate on the home: Typical time frame: 1 day – 1 week. It is common to receive a counter offer from the seller, sometimes asking for a higher price or a division of the closing costs that is more favorable to the seller. At that point a buyer can accept the counter offer, submit a counter offer of her own or reject the counter offer at no penalty and continue house hunting. Everything is negotiable so inquire about assessments, fixtures, window replacements, air conditioners, rugs, floors, curtains, appliances, working fireplaces, washer dryers, etc.
  5. Get insurance: Before you will be allowed to close the loan and officially take ownership of your new home, you will have to buy homeowner's insurance. A typical home insurance policy protects against theft, fire and liability, but if you live in an area of California prone to earthquakes, consider paying extra for a policy that will also cover earthquake damage. If you do not already have an insurance provider, Louisa can refer you to local agents.
  6. Closing: Typical time frame: 30 – 45 days. Closing is often referred to as "escrow" in California. The typical period for escrow is 30 days; however, you may have agreed to a shorter or longer escrow period during negotiations. During escrow the transaction process becomes finalized. Title records are checked for errors, taxes and other claims must be settled, loan and title documents are signed and the buyer is allowed a final walk through to make sure the condition of the property has not changed. After all the necessary paperwork is signed and filed and escrow has closed, the new owners receive the keys to their new home and are free to move in.
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February 05
Well if want to be qualified for a loan the next step would be to speak with a lender that best fits your situation. Then when you do apply for a loan, lenders like myself will need to look at several different things if you are trying to prequalify for a loan. We will need to analyze your assets, credit, expenses, income, debt, employment, down payment, etc. So the best thing for you to do is to speak with a lender such as myself to see if you can get started on financing a new home. If you have any further questions or if you would like a loan, feel free to contact me.

Good Luck!
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February 05
As mentioned below, your next best step will be to find a lender to see what otions you have. I am located on Mount Laurel NJ across the bridge from you and would be more than happy the go over what options you have. There are some state programs in PA that also help with new home borrwers. You cn contact me through my profile here if you wish,

Good luck and best wishes!

-Scott

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February 05
The first step is to sit down with  a lender who can check your credit score, and give you an idea of the amount of loan you will qualify  for based on income and debts. The loan officer may suggest how to improve your score and you can also check for errors in your report.

You should set up a budget and start saving for a down payment.
Pay all your bills on time.
There are resources for home buyers at www.hud.gov . You can find names of lenders and credit counselors as well as home buying tips.

Based on the amount of the loan that you will qualify for you can decide on price of the home that you can afford..
Ask your friends to recommend an agent or interview a few agents and choose one agent. It is a good idea to work with a buyer agent who will guide you and represent your interests. It is important to hire a good buyer agent who returns calls on time, who is a good negotiator, who is available to show homes at times that you want to see homes. There are some buyers who can only see on weekends and there may be agents who do not work on weekends.
Check the agent's blog and web site.

Sit down with an agent to discuss your home buying needs. 
The agent will explain the home buying process .
Do not go to new construction without your agent. The sales person at builder's  model homes represent the builder.

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February 05
Hi, mixeopro.

Good question, and not an uncommon one.

The best first step to buying a home, is to make sure you understand the Top 3: Credit, Income, and Assets. Most first-timers need a mortgage to buy, and these are the things that banks look at in order to approve you for a mortgage.

1. Credit: Your credit history needs to be at least average or better to get a standard mortgage (FHA, Conventional, etc).

2. Income: Your income/debts need to be in sync, even with adding your new mortgage payment as well.

3. Assets: You need to have a minimum down payment of at least 3.5% (FHA), and you need to also have money for closing costs (typically, 5% based on the purchase price).

Honestly, there are too many variables to talk about in this one post (even my brief explanations don't do your question justice). So if you are serious about getting started, let's plan to meet for coffee.

All of my contact information is below.

Best,
Tim
TimothyGarrity.com
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February 03
You have a lot of things to consider up front and along the way, but the most important three things I can come up with are:

1 - Establish a budget and a personal financial strategy.  I recommend using tools like Mint.com and reading books like "I Will Teach You to Be Rich" by Ramit Sethi.  Once you have a solid financial plan foothold, you can make informed decisions as far as how much you can save for down payment, how much you can afford monthly, etc.

2 - Optimize your credit score.  Check your credit scores (both you and your future spouse!).  There are a ton of services out there.  Just make sure you don't accidentally sign up for overpriced credit monitoring programs.  Once you know your score, if it is under 740, work to improve it.  740 is the target because it qualifies you for the best mortgage rates.

3 - Be careful when taking advice from friends and relatives.  Once you tell everyone you are planning to buy a house, you will start receiving a lot of well meaning, but awful, advice.  Even on Zillow I see bad advice coming from people that are not actually in the business of real estate and mortgage finance.  Our industry has changed drastically over the past few years and what people think they know if often out of date.  You don't need 20% down.  You don't have to be on the job for 2 years.  Ultimately, you will want to align yourself with some trusted industry professionals - including a Realtor and a mortgage banker.  Friends and relatives are often good sources for referrals - just not always the best folks at giving advice about the process.
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February 02
Profile picture for wetdawgs
Here's a link to Zillow's buyer's road map.

The first three steps (to be taken simultaneously).
1.   Study up on the process at the library, on line etc etc.  
2.  Save up a good down payment, closing costs and a slush fund.  Target a minimum of 10% of the price of houses of interest to cover those three.
3.  Make sure your credit scores are as high as possible.   640 would be an absolute minimum.

Other things to consider:
1.  "starter houses" can be a real pain, don't buy planning to move in a few years.
2.  If purchasing without the benefit of a legal relationship, make the partnership for purchase legal by meeting with a lawyer to identify financial roles and responsibilities and what happens if the relationship dissolves.

Good luck!   Thanks for planning ahead rather than making it an emergency.
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February 02
 
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