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Are you one of those people who
considers life to be pretty good? You're
thinking about getting married, have a
good job, nice car and money to pay off
the student loans. You have spare time
to spend hangin' out with your friends.
The only negative in your life right
now is having to pay rent and dealing
with roommates. For many Americans
in their late 20s and early 30s, the
"whoosh" sound of paying rent each
month eventually turns to thoughts of
owning your own piece of the
American dream. However, the process
of actually buying a home can seem
overwhelming, even daunting, to some.
"First-time homebuyers can feel
intimidated by or even `out of control'
during the whole home-buying
process," says Jim Ferriter, executive
vice president for GMAC Mortgage.
"But there's hope. An experienced loan
officer, combined with innovative
products and services, can help a first-
time homebuyer better understand
their financing options and boost their
confidence in purchasing their first
home."
Ferriter, who has more than 25 years
experience in mortgage lending, offers
the following tips for first-time home-
buyers:
1. Save, Just A Little Bit More - Of
course it's important to save money for
the down payment and closing costs.
But there's more to buying a home than
figuring out if you can pay a monthly
mortgage payment. Your costs may be
similar to renting, but now you must be
prepared to maintain a home, too.
Weekly shopping trips to your local big
box home store to purchase everything
from decorating items to a lawn mower
can add up quickly. That's why many
mortgage lenders recommend that first-
time homebuyers have at least three to
six months of additional savings. An
excellent way to save cash is with a
money market account from GMAC
Bank (www.gmacbank.com), which
can be opened with as little as $50.
2. Check Your Credit -- An
individual's credit score will
have a significant impact on
their mortgage loan
approval and interest
rate. A good first step in
the home-financing
process is to check
your credit history.
You can request a
free credit report
from any of the
three credit report-
ing bureaus:
Equifax, Trans-
Union or
E x p e r i a n .
Carefully review
your report and
contact the
credit reporting
bureaus to correct
any misinforma-
tion.
3. Get Pre-
approved --
Before you
start working
with a real estate
agent, consider contacting
a mortgage lender to obtain a
pre-approval credit decision. A loan
officer will review your financial status,
including your income, cash flow and
credit score, to help you determine the
maximum monthly housing payment
for which you may be able to qualify,
and, if qualified, "pre-approve" your
mortgage before you've found a home.
Armed with a credit pre-approval, you
can start searching with a much better
idea of the price range you should be
looking in, and in turn save time as
you'll know the right homes to focus
on.
As you start thinking and preparing
for the pre-approval process, start shop-
ping for the mortgage lender from
which you would like to obtain a mort-
gage for your new home. Because this
process is new, it's easy to go with the
first lender or loan officer
you meet. Instead, take
your time and shop
around. Start by ask-
ing friends, co-
workers and
f a m i l y
m e m b e r s
for recom-
m e n d a -
t i o n s .
W h e n
you've identi-
fied two or
three loan
officers, ask
for references.
R e m e m b e r ,
obtaining a pre-
approval may offer
more confidence
and certainty to
home sellers.
In addition to
pricing (interest rate
and closing costs),
focus on customer
service as well as other
services and tools that
a mortgage lender may
be able to offer you. For
example, in addition to
offering the pre-approval program,
GMAC Mortgage offers a feature called
"HomeCommand," which allows you
to cap a mortgage rate for up to 126
days while you shop for your dream
home, as well as a free, internet-based
home-finder service that can give you a
jump on other house hunters, alerting
you to homes that hit the market that
match your search criteria.
4. Don't Be Afraid to Ask Questions
- Once you've found your new home,
the mortgage lender will help you
through the details of the loan process.
From application to closing, your loan
officer will work through the financing
process with you, just as your real estate
professional will in the home buying
process. Your mortgage loan officer can
also be a valuable source of informa-
tion, so be sure to take advantage of his
or her expertise. Throughout the
process, read all loan documents care-
fully, and involve an attorney, if neces-
sary.
5. Inspect I -- Before you commit to
purchasing a home, don't forget to hire
a licensed home inspector to conduct a
thorough assessment of the property.
An inspector can alert you to any
major problems with the home, and/or
help you understand potential short-
term and long-term home maintenance
issues.
Buying a home for the first time can
seem like you're riding on a roller
coaster. But, by doing your homework,
asking lots of questions, and taking
your time, you can stay "in control"
and discover an overwhelming sense of
accomplishment in buying your first
home.
Courtesy of ARA Content
The Citizen. Auburn, New York
Secure Your Future
Wednesday, January 31, 2007
7
Your Money Matters: Buying First Home Need Not Be Overwhelming
James J. De Vaney
John Michael De Vaney
Jamie Kaim
Funeral Directors
De Vaney - Bennett Funeral Home
"Serving the Geneva area for over 108 years"
181 N. Main St. · Geneva, NY · 315-789-2224
