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Nancy Conner - Buying a Home

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Nancy Conner Buying a Home

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Buying a Home: The Missing Manual
Nancy Conner
Beijing Cambridge Farnham Kln Sebastopol Tokyo A Note Regarding Supplemental - photo 1

Beijing Cambridge Farnham Kln Sebastopol Tokyo

A Note Regarding Supplemental Files

Supplemental files and examples for this book can be found at http://examples.oreilly.com/0636920000563/. Please use a standard desktop web browser to access these files, as they may not be accessible from all ereader devices.

All code files or examples referenced in the book will be available online. For physical books that ship with an accompanying disc, whenever possible, weve posted all CD/DVD content. Note that while we provide as much of the media content as we are able via free download, we are sometimes limited by licensing restrictions. Please direct any questions or concerns to .

The Missing Credits
About the Author

Nancy Conner is the author of several Missing Manuals. She and her husband Steve live in upstate New York where they write books and invest in rental properties. Nancy fulfilled all the New York state requirements to become a licensed real estate agent. When shes not writing or looking at investment opportunities, Nancy enjoys visiting local wineries and listening obsessively to opera.

About the Creative Team Peter McKie editor is an editor at Missing Manuals - photo 2
About the Creative Team

Peter McKie (editor) is an editor at Missing Manuals. He bought his co-op before this book came out, and was pleased to find that, through blind luck, he refinanced after his break-even point (see .

Nellie McKesson (production editor) is (as of this writing) in the process of buying her very first home, in Brockton, Mass. When not filling out mortgage-related forms, she spends her spare time studying graphic design and building her t-shirt business (.

Marcia Simmons (copy editor) is a freelance writer and editor living in the San Francisco Bay Area. In addition to writing about technology, design, and cocktail culture, she maintains a personal blog at SmartKitty.org.

Ron Strauss (indexer). When Ron is not indexing books, he is on the lecture circuit educating people in how to become radiantly healthy with Natural Healing and a mostly raw vegan diet!

Jay Neeley (technical reviewer) is a cofounder of EasyImpress (http://www.easyimpress.com), a website developer for real estate agencies. As a Boston entrepreneur, when hes not putting the Silicon Valley startup scene to shame, hes working from coffee shops, creating odd constructions in the snow, and adventuring in and around the city.

Arwen OReilly Griffith (technical reviewer) is an editor at Make magazine and blogs at Craft online magazine. Shes the mother of a rambunctious 1-year-old and just bought a teeny-tiny house on a hill in San Francisco with her equally crazy husband, Saul. She has big plans for her small garden.

Acknowledgements

A book like this requires the knowledge, skills, and talents of many people to take it from initial idea to finished product. I was fortunate to work with a world-class team. Thanks to Pete Meyers for suggesting the project. Editor Peter McKie helped me shape the outline and offered invaluable feedback. Thanks to technical reviewers Jay Neely and Arwen OReilly for their suggestions, comments, and corrections. Thanks also to copyeditor Marcia Simmons for rooting out typos, inconsistencies, and other mistakes.

Stephen Shore of InsideOut Inspections (www.housewiz.com) in Ithaca, New York, graciously provided the Missing CDs sample home inspection report. Ive worked with Steve many times, and hes a first-rate home inspector. Thanks, Steve, for sharing your expertise here.

As always, my husband Steve Holzner was loving and supportive throughout the many long hours it takes to write a book. (Hes written more than 130 himself, so he knows better than most what the process requires.) Thanks to him for hand-holding, back-patting, and providing me with a cozy fire and a glass of wine on Sunday evenings. Hes the best!

Nancy Conner

Introduction

Welcome (almost) to the world of home ownership! The fact that youve picked up this book and flipped it open to the Introduction says youre serious about buying a home, and youre looking for step-by-step guidance through the processfrom finding the right home to signing the papers that make it yours. Either way, youve come to the right place.

Buying a home is a big step. In fact, its many big stepsto the first-time homebuyer, the process can seem long, complex, and more than a little confusing. This book takes the confusion out of buying a home, guiding you through each step of the process and offering tips and information along the way. And if youve bought property before, this book serves as a step-by-step refresher course with information on all the current real-estate practices. Neophyte or veteran, youll feel confident about one of the biggest decisions youll ever make.

Should You Rent or Buy?

Home ownership is a big step, and many people worry whether theyre ready to take it. If you currently rent your house, you may wonder if you can even afford to buy a home. Just looking at real estate listings online or in the Sunday paper can make you break out in a cold sweat. Yes, homes are expensive. But theyre also an investment and for many homeowners, its one of the smartest investments theyll make. Depending on how much you currently pay for rent, how expensive homes are in your area, what your credit score looks like, and how long you plan to live in the house (among other factors), buying a home is often less expensive than renting in the long run. After all, when you rent, you just pay for a roof over your head. When you buy, you become the owner of that roofand everything beneath it.

Tip

To see whether renting or buying makes better financial sense for you, use myFICOs Am I better off renting? calculator. You can find it at http://tinyurl.com/yagk6lr.

Renting does have its advantages. Here are some:

  • Renting offers more flexibility . If you like knowing that you can pack up and move at a moments (or a months) notice, it may make more sense to rent. Depending on the terms of your lease, youre not tied to a residence for more than a year or two at most. When you own a home, on the other hand, you need to sell the property or find a suitable tenant before you can moveor else youll end up paying a mortgage on an empty house.

    Tip

    If you know youre likely to move within three or four years, youre probably better off renting than buying. Thats because you wont have time to build up much equity in your house (its cash value as you pay off your mortgages principal) or break even on your closing costs. ( gives you an overview of the many costs associated with buying a home.)

  • Maintenance is someone elses headache . When you rent, you call the landlord if a pipe bursts or the furnace quits. He sends someone to fix itand takes care of the bill. When you own, all the maintenancefrom keeping everything in good repair to mowing the lawn and shoveling snowis your responsibility.

  • You can move in faster . Buying a house takes time. If youre in a hurry to move to a new neighborhood, you might want to rent for a year and look for a place to buy during that time. Renters can usually move in soon after getting their rental application approved. Buying a home, on the other hand, takes months. Youll be living in your new house for years, so you want to take your time finding just the right home. Then you may spend a couple of weeks negotiating with the seller before you agree on a price and conditions. And getting financing and preparing for the property transfer can take 30 days or longer.

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