Making the home buying process easy and customer friendly is the standard at Prudential Indiana Realty Group Companies Our customized home search system is designed to provide you with a full service, real estate experience. We will deliver a level of service unmatched in the real estate industry. This system answers all of the questions and concerns that buyers are challenged with when purchasing a home. To make the process easy, we offer to every buyer;
At Prudential Indiana Realty Group Companies, our agents understand that buying a home is one of the most important decisions you will ever make in a lifetime. It's more than just deciding about bricks and mortar, it is deciding your future. The Prudential Indiana Realty Group Companies team makes it simple!
READY TO BUY YOUR INDIANA HOME
Rent vs. Buy - As a homeowner, when filing your taxes you can deduct the interest portion of your monthly payment-and that can mean big savings. Use this article and the rent/buy calculator to help you understand
Do Your Market Research - It is important to obtain market research on the area of the home you wish to buy. This allows you to negotiate a fair price and terms for the property.
Home Buying Quiz - How Well Do You Know the Homebuying Process? Take this quiz to see how smart you are and to learn some key homebuying terms.
Buying a house is one of the biggest purchases you will probably ever make. To make a wise decision about what your mortgage and financing needs are before and during the purchase of a home, you need to know the financial facts.
You have rented for several years and you have decided it's time to buy your first home. You are tired of paying rent without anything to show for it and you really want a place of your own … a place that is all yours. Let us help you make that first step by considering some financial aspects.
Consider the Tax Break As a homeowner, when filing your taxes you can deduct the interest portion of your monthly payment-and that can mean big savings. You can deduct your property taxes, too. So look at what your monthly mortgage payment will actually be, taking your tax breaks into consideration. You may find out it's about the same as-or sometimes even less-than a rent payment! For example, with a 5% down payment, a $100,000 30-year mortgage loan at 8% interest (8.15% APR) requires a monthly principal and interest payment of $733.76. Assuming a 28% tax bracket and $150 for monthly property taxes, the after-tax monthly payment would be about $615!
Find out prices, particulars before buying:
Inman News Features
The strength or weakness of any given housing market will determine the framework for your homebuying process. Awareness of market conditions will give you a leg up when it comes time to find, evaluate, and eventually buy that dream home.
What is a good way to measure the strength of the housing
market?
Find out how long it is taking to sell homes in the area. A multiple
listing service (MLS) tracks this information. If the average selling
time was four months a year ago and now it's two months, this indicates
that there are more buyers in the market or fewer new listings, or both.
When this situation occurs, price increases usually follow. Also look
at how close the selling price is to the list price. In soft markets,
there's usually a larger gap between these prices than there is in a
rising market. Find out if homes in the area are selling with multiple
offers. This usually means that demand is outstripping the supply of
available homes for sale. This situation can drive prices higher.
What is a HUD-1 form?
This is a settlement sheet that shows the net proceeds from the sale.
Lenders need to verify the source of the buyers' down payment before
they will grant a loan. Buyers whose down payment is coming from the
sale of another property will probably be required to provide the lender
with a HUD-1 form after the sale of that property.
What is a lease option?
It is a lease with an option to buy the property. It is often touted as
the way to purchase a home for buyers who are short of the cash or
income needed to qualify for a conventional home purchase. Here's how it
works: The prospective buyers lease the property for a period of
time-usually a year or more. The option agreement gives the renters the
right to buy the property at the end of the lease period, or earlier, at
a predetermined price. In exchange for this privilege, the prospective
buyers pay a sum-called option money-to the seller. The option money is
applied to the purchase price if the buyers complete the purchase; if
they do not complete the transaction, the option money is forfeited and
retained by the seller. The lease agreement usually calls for a portion
of the rent to be credited toward the down payment.
What is a material fact?
A material fact is one that affects a buyer's decision to purchase, or
the price a buyer will pay. An example of a material fact that is not
readily apparent to a buyer is a leaky roof if there are no telltale
signs of leakage. Maybe the sellers painted over stains on the ceiling
while getting the house ready to market. In this case, the buyers would
not know that the roof leaks unless the sellers told them. What is a
quick way of learning about the housing market? Previewing Sunday open
houses, even before you are a serious buyer, is one way to start
learning about the housing market. Find out the ultimate selling price
of properties you have seen.
Buying a house can be confusing, what with finding the right number of bedrooms and bathrooms, the size yard you want and interior features that catch your fancy - all in the neighborhood you desire.
Once you've looked at a dozen or more houses and made your selection, it's time to collapse in your easy chair and put your feet up on the ottoman, right? Wrong.
Finding the house is only the beginning of the process. You also have to negotiate the price if it's a resale house, determine options and lot location if it's new construction, make a down payment, have a credit check done, arrange for financing, meet with title company officials, attend the closing, and take care of myriad other details that come up.
Along the way, you'll encounter the mysterious lingo of home-buying, terms such as "points" and "lock-in." These words mean one thing in everyday language, but something totally different in the realm of real estate.
Don't become frustrated. Instead, familiarize yourself with the jargon, before you buy a house, so you'll feel confident about the process. Don't hesitate to ask a real-estate agent, lender or other housing professional to explain exactly what he or she is talking about if you don't understand the terms.
Take the following quiz to determine your home-buying savvy. Give yourself 5 points for each correct answer.
SCORING: 70 to 75: You're a pro at
the home-buying game. How many houses have you purchased? Four? Six? Or
are you a real-estate agent?
50 to 65: You've been through this real-estate thing
before, at least once. Still, you'll need to concentrate on your next
sale/purchase to make sure your eyes don't glaze over at some of the
jargon.
Below 50: Remedial real-estate help is needed. Retake
the quiz. Read the real-estate columns. And, please, talk to some
real-estate and lending professionals before you buy a house.
The Basics Ways to Qualify Cleaning Up Credit Problems
The Basics
There is a big difference between being pre-qualified for a mortgage and getting a pre-approval. With the housing market moving at a breakneck speed, it's wise to get pre-approved before you begin your home search process.
Once you've calculated your estimated mortgage payment, is it still
too high for you budget?
Here are other options:
Don't be discouraged if your credit history doesn't sparkle. Lenders have a huge variety of mortgage products and special programs to help you qualify for the house you want. Let your loan officer help evaluate your credit history and provide assistance.
Here are some hints for correcting inaccuracies on your credit report:
It's natural to feel anxious when you buy or sell a home. As a buyer, you don't want to overpay; as a seller, you don't want to sell too low. How do you make sound investment decisions that you'll feel good about for years to come?
The best way to relieve your anxieties is to be proactive throughout the process of your real estate transaction. It's tempting to fall into a "wake me when it's over" mode. Resist the temptation. Stay involved! Only you can make the important decisions that will affect the course of your home purchase or sale.
Unless you have real estate expertise and a lot of free time on your hands, you'll be relying on various real estate professionals to assist you with your transaction, including real estate agents, mortgage lenders and home inspectors, to name a few. Hire the best team of professionals you can find. One of the best ways to find good people to work with is to ask for referrals from friends and colleagues who bought and sold recently.
Let your team know that you want to be kept well informed during the course of your working relationship. This means that you want to know about problems that may come up. And, you want to know about them sooner rather than later. Some professionals think they're doing their clients and customers a favor by insulating them from bad news. This can have negative consequences if you find out too late about a problem that could have been corrected if you'd only known about it.
FIRST-TIME TIP: Homebuyers and sellers often feel overwhelmed by the amount of paperwork that's involved in a real estate transaction. Ask for copies of the important documents you'll need to sign - - like the purchase agreement and mortgage documents -- in advance. This way you can read and understand them before you have to sign them.
You should keep copies of all transaction-related documents. If there is anything in the documents that you don't understand, ask your real estate professional for an explanation. Hire experts if you have complicated tax or legal questions that are outside the area of expertise of your real estate agent or mortgage lender.
Your purchase contract should include contingencies designed to protect you. Most contracts include contingencies for financing, inspections and title review. Don't remove these contingencies until you're confident that they have been satisfied. If you're a buyer and choose not to protect yourself with contingencies, you should understand that you might risk losing your deposit if you do not go through with the transaction.
Most buyers make a good faith-deposit when they enter into a contract to buy a home. Your contract should specify what happens to the deposit if the sale is not completed, or if contingencies are not satisfied.
More and more, homebuyers and sellers are using the Internet to help them buy and sell homes. Internet advertising is not regulated, so don't rely exclusively on the information you obtain on the Internet. Verify critical information independently.
Be diligent about seeking answers to every question you have about the property you're buying before you complete the transaction. This includes having the property thoroughly inspected. Keep a transaction log or diary of events that occur during your home purchase or sale, including a record of important phone conversations.
THE CLOSING: Be realistic about the process. Real estate transactions are rarely hassle-free, so there are bound to be unanticipated frustrations along the way. But the end result is worth it.
Dian Hymer is author of "Starting Out, The Complete Home Buyer's Guide," Chronicle Books.
When you're considering the purchase of an existing home, it's very easy to become blinded by your desire to close the deal on your dream house. The drive-up appeal is there, the layout is just what you wanted, and there's a nice, big backyard for the kids. Because you want to make this work so badly, you fail to notice (either consciously or unconsciously) the cracks on the walls, the rotting floorboards in the living room, that musty smell lingering through the halls.
To protect yourself and your investment, you'll want to make sure that you have a professional home inspection of the property before you even give a minute's consideration to buying any house. But you can conduct your own investigation as a prospective homeowner, as well. An informal "chat" with the current owners can be even more valuable than a professional inspection. Why? Nothing beats face-to-face conversation. Granted, the current owners want to sell. But if they want to sell badly enough, they'll respond openly and honestly to your questions, and they'll be willing to resolve any issues or conduct any repairs that stand in the way of your closing the deal.
So what should you ask the current owners? The following questions will provide you with a good start. And just like any journalist conducting an interview, as you proceed with your questions, you'll often think of other points you want to cover. These questions are merely a guideline; feel free to jump off the course occasionally. Whenever possible, ask your questions in "open-ended" style. "Yes" or "no" questions are too easy for the respondent, and they don't help you as a prospective owner. And as you listen to the owner's responses, don't interrupt. Let silence creep in occasionally. Your silence tends to lead to the owner's volunteering more information.
Start with the following questions:
Webb insists that heart and mind must work together if you want to find the right home for you and your family. And you'll need to go about it as methodically and as creatively as you did when you went to school to learn something. Most of all, Webb says, "You must do your homework."
Beyond that, you must know what makes you comfortable, and what makes you uncomfortable. Get your feet solid on the ground. Webb suggests this because she believes that if you are swept away by your emotional attachment to the house, you can always fall back on whatever is concrete to give you the balance you need to make a sensible decision.
"Your best clues are in your past," Webb says. "Look back before you look forward, and before you lose your heart, think." Ask the right questions of yourself every step of the way, but particularly, if you fall in love right away. Why does this house look so good? Is it the house, or the owners' decorating, or their life? Look beyond the surface and know what details in your life and your previous homes have made life comfortable or miserable.
The Buying process - You have the found the perfect home, you feel the need to act fast, your Prudential Indiana Realty Group sales associate is ready to help you complete the process … but you are filled with nervous anticipation. To help you understand the process from this point through closing, the steps are:
Writing the original offer to purchase.
The form looks intimidating, but don't panic. Your Prudential Indiana Realty Group sales associate will guide you right through the process from start to finish! The original Offer to Purchase is a relatively complex form. It includes all of the basic contingencies that are necessary to protect your rights as a buyer, such as - Closing is contingent upon; Your ability to obtain satisfactory financing; upon satisfactory staked survey or surveyor location report; upon seller's ability to provide clear title; upon satisfactory inspection report; upon clear termite and lead based paint inspections; plus any further conditions you may wish to add to the offer.
The Offer to Purchase puts all of the understandings between you and the seller in writing in order to prevent any misunderstandings or bad assumptions. You need to make sure you list all of the items you expect to remain to remain with the home in detail, so make notes as you tour the homes.
If you notice any easily visible repair items that you want the seller to repair prior to closing, like broken windows, bad roofs, ect., ask the seller in the original offer to make these repairs. This way they can be negotiated as part of the original offer. Note: Your inspector may find items that you were unable to see or anticipate - these repairs are negotiated as part of the inspection process.
Be prepared for counter offers. Don't let the pressure get to you. Remain patient, and let your sales associate act as your liaison with the seller and/or the seller's agent. You may need to be flexible on price, closing date, appliances and repairs.
Beware of putting contingencies in your purchase agreement. They weaken your offer. However, if you currently own a home, your offer may need to be contingent on it selling. Just be aware any contingency could take you out of the running if a non-contingent offer is presented.
Earnest Money is always part of any purchase agreement. You will be expected to submit an Earnest Money check with the original offer. It will not be cashed until you reach terms and have a signed bi-lateral contract. The Earnest Money check is then deposited in the listing Realtors escrow and held until closing. It will be applied to your down payment at closing. Your Earnest money may be forfeited to the seller if you fail to complete the transaction without legal cause.
According to law, Earnest money can be anything as long as it is acceptable to both buyer and seller. But keep in mind, it is important to make your deposit for earnest money an amount large enough so that it indicates you are serious about the purchase and that you are making the offer in good faith.
We recommend that you always reserve the right to have the property inspected by a professional home inspector. A fresh coat of paint or new carpeting may disguise serious flaws. A professional home inspection surveys of the foundation and structure, roof, exterior, major systems (electrical, heating, cooling and plumbing), and appliances that will stay with the home. You must choose the inspector and pay for the inspection yourself so the inspector is representing and working exclusively for you. You can find a list of inspectors in the yellow pages and also in our Service Provider Directory. Call several inspectors and interview them for their credentials and experience to find an inspection company that you feel will do the best job for you.
You should add a home inspection contingency to your purchase agreement. This allows you time to get the inspection completed and to receive the response. After you receive the response, discuss the repairs that you would like to ask the seller to complete. Your sales associate will help you make a response to the report and will negotiate the repairs with the seller's agent. When buying an resale home, understand that it is not new and with every home, there is normal maintenance that needs to be done on a regular basis. The inspection is to find MAJOR defects, such as a bad furnace, roof, electrical system ect. Keep that in mind when making your response.
During the Inspection. Be sure to be present at the inspection and tour the house with your inspector. They will point out potential trouble areas, as well as what's "sound." If the inspection does turn up some flaws, a seller is often willing to make repairs, but it may depend on market conditions. Take notes as you tour. Get the inspection report in writing. This document will support or deny the items you include in your response to the inspection report.
You're finally in the home stretch. You've signed a purchase agreement, inspections are over, your mortgage is approved and processed, you have your homeowners policy and it's time to close on your new home. Closing (also called the settlement) is arranged by your real estate professional and usually takes place at a title company.
What To Expect
Many people may attend the closing: you, your sales associate, the seller (or builder) and their real estate agent, and an escrow agent (closer) from the title company, and possibly attorneys for the you or the seller. During the meeting, which usually takes an hour or so, you and the seller will review all of the relevant closing papers with the closing agent, many of which you'll sign. Then, after providing a cashier's or certified check for the down payment and closing costs, your ID and Insurance Policy along with a paid receipt and the keys are passed to you and the house is yours!
What To Bring In the rush of excitement of owning a new home, don't forget to bring these following items:
If you're the buyer:
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