Adam Rodriguez - The 8-Step Guide To Buying Your First Home

TABLE OF CONTENTS

THE 8-STEP GUIDE TO BUYING YOURFIRST HOME

2015 by Adam Rodriguez at Smashwords. Allrights reserved.

Introduction

If you get, give. Ifyou learn, teach. Maya Angelou

The purpose of this ebook is to give you astep-by-step guide to buying a home from a real estate agent'sperspective. I want you to have the inside track in hopes todemystify the home buying process, so you will know what to expect,save time, and most importantly, save money. Ill let my agenthandle it is not the best approach nowadays. How will you know theagent is doing his or her job? I want to go beyond the cute littlecookie cutter blogs and articles out there in order to give you anedge when it comes to buying one of the biggest assets of yourlifetime. I encounter so many people who really dont have a cluewhen it comes to the home buying process and that is ok, as it isnot their fault. With up to 10 parties involved in the transaction,it can be overwhelming and this is where my ebook comes into play.I will break down the home buying process step-by-step, cutting outthe nonessential information to provide you with only what matterswhen purchasing a home.

After receiving my real estate salespersonslicense in 2013, I quickly became familiar with all the legalaspects of real estate. Easements, valuation processes, agency,fair housing, etc., are each important in their own right, butthese elements did not prepare me for the actual process of buyinga home. I say process because that is what home buying plainly is -it is a series of steps or actions taken to achieve a particularend. The process looks so easy on TV shows. Pre-approved buyersmagically appear, they look at three homes, choose one, theres aone minute negotiation, and the buyers are homeowners in 22minutes. I wish I could say it was that simple, but that would belying and I would just be setting you up for failure.

My goal is to instruct you on the process ofbuying a home, so that when things get overwhelming rather thangiving up, you will follow through to your particular end, which ishome ownership. In the first chapter of my ebook, we will explorethe very first step in the home buying process, which is thedecision to buy a home. Most blogs and articles will start with thepre-approval process, but I believe to see this through to the end,there must be a firm, committed decision made before any othersteps may follow. The decision to purchase a home is not made on awhim or just because; this decision involves your goals and visionfor your future. If you close your eyes right now and picturerealistically what living accommodations you prefer, I will betnine times out of ten you will see yourself in your own home. Solets start by making a decision to quit being held down by a landlord or any other circumstance and become queen or king of your owncastle.

Chapter 1: Make a decision

It is in your momentsof decision that your destiny is shaped. TonyRobbins

What decisions have you made lately? Maybeyou decided to switch careers, end a relationship, or get in shape.Whatever your decision was, it was based in some initial cause. Inregards to buying a home, the catalyst for your decision could havecome from a number of things: starting or expanding your family,receiving a promotion at work, or you are just tired of payingrent. Whatever your personal reason, youve decided, yourecommitted, youre serious, and ready to make a significantfinancial investment in a home. So what now? Time to take stock ofyour current situation.

Can I start looking for ahome right now?

When speaking with potential homebuyers, Ifeel they compare purchasing a home to purchasing a car. Rightfullyso, and having recently purchased a car, I can see where some ofthese comparisons as well as misconceptions come from. When buyinga car, you show up to the dealership with no need of beingpre-approved, test drive a few cars, pick out the one you like, andnegotiate with the salesperson on a fair price. You will thenlikely go through the financing portion where your credit is run,and if all goes well either the same day or a few days later, youleave the dealership with a new car.

When you break it down, a car is consideredan asset - there are salespeople involved, negotiations, financing,a financing associate, loan terms, monthly payments, down payments,and a contract wrapped up into one transaction. Sound familiar?While the car buying process is similar, there are many more steps,many more weeks, and possibly much more anxiety involved in thehome buying process than the car buying process. For example, whenpurchasing a home you cant put in an offer that will be acceptedunless you have a pre-approval letter stating that a bank will lendyou X amount of dollars or a bank statement showing that you havethe cash in your account to cover the purchase. Also, the financingstep for purchasing a home requires much more than when purchasinga car. For instance, 2 years of tax returns, 4-8 weeks of paystubs, and recent bank statements are just some examples ofadditional required documents that you will be requested toprovide, which are verified more than once.

Where are youprofessionally?

How confident are you in maintaining yourcurrent state of employment? Do you see the industry you are inexpanding, or contracting? Take a moment to consider these factorsbecause you will need steady income for the next 15-30 years tosatisfy a monthly mortgage payment and other home related expenses,such as heat, electric, cable and so on. So if your employmentstatus is not looking too bright or you are not confident in yourability to move up in your career, it might be time to update yourresume and upgrade your profession before moving forward with yourdecision to purchase a home.

Do you plan onmoving?

Whether hoping to move from your currentresidence for work or personal reasons, in state or out-of-state,your moving plan is extremely important to know at this time.Without a plan, you could end up in an unfortunate situation whereyou have to sell your home for less than what it is worth if youneed to move in a short time span. I know it is impossible to tellthe future, but I would strongly suggest trying to outline andsolidify any moving arrangements before buying a home. Trying tosell your home within a 5-year time frame could seriously delayyour plans. This is due to the fact that the real estate marketcomes in cycles, so it is important to consider that if you try tosell in a downturn, it could take months or even years to sell yourcurrent home.

Basic personalfinance

What do your finances look like? Do you knowwhat is coming in and going out every month? How much money do youhave saved? You have to know your finances inside and out, andkeeping a monthly budget helps you gain a realistic picture of yourexpenses. I understand that there are costs that seem to come upout of nowhere, such as a car repair or doctors bill, but that iswhy you should consider starting an emergency fund. Closing costsalone can be expensive when purchasing a home. For instance, Irecently had a sales transaction where closing costs wereapproximately $17,500 on a $150,000 home. While there were nosellers concessions to reduce the closing costs in this case, Iwant you to have an example of a real dollar amount so that youwill know in advance what to expect to pay in closing costs. Startgetting your finances in order today by keeping track of expenses(any reoccurring or monthly debts), savings (to assist with downpayment/closing costs), and sources of income, because they will beverified when you go for your mortgage pre-approval.

Exploring housingneeds

What are your housing needs? 3 bedrooms, or4? Do you really need that 3rd bathroom? What you wantwill sometimes end up costing more than what you need. For example,a three-bedroom fixer-upper could fit into your budget more than amodern, four-bedroom with all the upgrades. Intelligent home buyingwill always require give and take on your housing needs vs. housingwants, especially when working within a mortgage budget. I am nottrying to rain on your parade, but you can always make improvementson the home you purchase over time.