It occurs to me that most first-time home buyers start thinking about buying a home and then begin that process by going online to do a little research. You can go to RE/MAX.com to begin your search now if you like.

This type of search asks you to for a general price range and perhaps a city or two that you want to search for homes in. When you search a website like this you can view almost all the homes available not just RE/MAX listings.

Your search will miss some of the homes available, but when you hire a Realtor they will have access to all homes in the area.

You will probably notice some real estate website have articles on tips for buying a home. This is a great way to begin your research. That is also why I included links for you to view on this web page.

WHAT IS YOUR CREDIT RATING:This is a great time to check your credit to make sure you don't have any surprise when you go to get approved for a loan. Do this even if you are a year away from buying. Sometime credit repair takes that long. There are very few options available if your credit is not good, so don't procrastinate this.

LOOK FOR A REALTOR: Some people begin there search by talking to friends and famly members. I don't discourage that; however, the best they might be able to help you is to refer you to a top Realtor who they have worked with in the past.

I have also noticed that many buyers like to get their feet wet buying driving around neighborhoods. Perhaps a first-time buyer will visit some open houses to get to know what homes in their favorite neighborhoods are selling for. This is another great way to get started. Notice that you can kill a whole Sunday afternoon doing this. Ask yourself: "Is it really worth my time driving around, or are you better off looking online some more or calling a Realtor at this point?"

How long do you spend researching before you move to the next step? This is up to you. Some people spend two years, many people spend a few months and some jump right in to actively looking within a few days.

So you know you want to by a home. You have done the research you wanted to do. Now whats next?

Step #1: FIND A REALTOR

Your Realtor can help you with many things. One of the first things I help people with is seeing what they can afford. There are a couple things that are important at this stage. One is the amount you as the buyer thinks you can afford. The other is what the bank says you can afford. If those two numbers match up we are in good shape. If not we might have a problem. One of the challenges might be that you qualify for less then you think you can afford. With the amount of financing programs out there now, you might be stuck if this happens. At least you will have to lower your expectations of the home you will purchase. Of course you might get approved for way more then you feel you can afford. At this point you need to know your budget and stick with it, so you don't get into trouble later.

Step #2- TALKING TO A MORTGAGE PROFESSIONAL

I typically refer people to a prefered lender I work with. If you already know someone you feel comfortable with you are welcomed to go with them. It is a good idea to get two quotes. You want to make sure you are getting the best rate and loan program for the situation. See if your mortgage professional can give you two or three loan program options. Also at this time they should be able to give you an estimate of closing costs. The fees for closing costs generally total about 3% of the loan amount. That number is normally higher on lower priced homes and lower on higher priced homes.

Ask your Realtor to review the financing options and closing fees upfront with you so you understand everything from the beginning.

Note:Check to see if your local area offers first-time buyers programs like the one mentioned in the news story below. Your Realtor and Mortgage Officer will know.

Step #3 - HAVE THE REALTOR ANSWER YOUR QUESTIONS

If you are like most buyers looking to buy your first home you probably will have a lot of questions. A good time to ask them is before you start looking for homes. Notice we took care of the financing upfront to make sure that you qualify for a home. The theory with that is why spend time looking at a bunch of homes and then find out you don't qualify for a loan.

At this point you know what you qualify for, you have done some research on your own, so now is a great time to sit down with the Realtor you choose and ask a bunch of questions. NOTE: For those of you not referred to a Realtor at first you may get approved by a lender and then interview an agent after that.

What I normally do is spend time finding out what a buyer wants in a home. What areas? How many bedrooms? Garage stalls? Style? Lot size? Time Frame? and so on. After this I normally go through a few more questions about the buyers expectations. Very often I answer most of a buyers questions up front.

A lot of people want to go look at houses first. This is fine, but I do think its important to meet your agent and go through your questions first. It might take an extra hour upfront, but it tends to save stress and uncertainty in the future for first-time buyers.

A GREAT WEBSITE FOR BUYERS,SELLERS, AND REALTORS:


You can find great local Elk River, Minnesota real estate information on Localism.com Chuck Carstensen is a proud member of the ActiveRain Real Estate Network, a free online community to help real estate professionals grow their business.

If your like most buyers you want to look at homes. The things I mentioned above this seemed boring and you want to just look at houses.

The reason why you do the above items is because in today's world, more than ever before, most people are on a time crunch. Think about it. There are a lot better things that you could be doing rather then looking at houses you don't want to buy. So its important you communicate with your Realtor, this way he or she can help you save time by only showing you houses that you might want to buy.

Key Point #1: How may house should you look at?

The average buyer looks at 8-13 homes. If you look at more homes then that either you don't really know what you want or you and your Realtor aren't communicating effectively. If you know what you want and you see an excellent home right away...you are perfectly fine buying a home if you only look at 3-5 homes. In most markets today there is a bigger selection, so chances are you will look at 8-13 homes.

Key Point #2:I found one I like, now what?

This is when you make an offer. It used to be that you would have to offer full price or more to get an offer accepted. In the current buyers market that most areas are experiencing chances are you get a price savings. You need to allow your Realtor to show you the compariable home sales though. If the home is priced great at the current price and you offer low you still risk losing the offer to another buyer.

If you are buying a bank owned home and are trying to get it for 50 cents on a dollar that normally won't work either. Think about it this way. If they wanted to sell it for that much off, they could just drop the price and get a lot of interest from multiple buyers at the lower price. In my area the foreclosures are selling for about 70-80% of the market value. That does not mean buyers are offering 20-30% less. Often times they end up reaching a price point 20-30% under the occupied homes and then sell for at or close to full price.

Notes: For all buyers this is why its important to work with a agent that represents you as the buyer. Because most purchase agreements are rather long and have key points that could cost you extra money in the long run if you allow the agent working for the seller to represent you. Again know what the real estate practices in your area are.



Key Point #3:Getting an Offer Accepted

Know that the seller can reject your offer, accept your offer, or counter offer your offer. Typically you will get the last option. If you are like most buyers you offered lower then FAIR price to try to get a good deal, so the seller will counter offer you asking for a higher price. This could go back and forth several times. If you are working with a bank owned property you might have to wait a few days each time for a response. If you are buying a home SUBJECT to lender approval be aware that it might take you two months to even get a counter offer or acceptance.

Note: The difference between BANK OWNED and SUBJECT TO BANK APPROVAL homes is the fact that the BANK owns the home in the first case and in the second case the home owner still has rights to the property but owes more then the asking price so the BANK has to approve the sale at the lower price. The BANKS are so backed up right now it takes way too long in my opinion.

Key Point #4: What Happens After the Offer is Accepted

Perhaps you bought the home contingent on getting a home inspection. This is where you can get the inspection scheduled to keep things moving along. Inspections are more for major issues. If you are buying a previous owned home there will be many things that get noted on the inspection that are mostly FYI. The little things that come up are not something that a buyer typically takes back to the seller requesting repairs. If there are bigger concerns you certainly should address them.

When your offer gets accepted you also need to be in contact with your mortgage officer to turn in updated documentation (pay stubs, W2's,etc) if needed.

Otherwise you can start packing once you feel confident that all the contingencies have been removed. My buyers get the use of our moving truck FREE. (Very few Realtors have a moving truck). If your realtor has a moving truck get that reserved. Buyers working with me also get FREE moving boxes. Most Realtors don't have these for FREE either but be sure to check to see what additional service your Realtor might offer.

FINAL POINT: Closing!!

Many states do this differently. So have your local Realtor explain what happens at closing. The final result is that YOU OFFICIALLY BECOME A HOMEOWNER at closing.