Finance: A Beginner's Guide to Buy a House

A Beginner's Guide to Buy a House

Written by Andrew L

There is no doubt that repparttar

market for houses has been on fire recently. More and more people are taking advantage of low interest rates and easy mortgage loan terms to go from being renters to being home owners. With so many people entering repparttar 149100

market, it is inevitable that questions will arise.

There are many things to consider when buying your first home. Some of repparttar 149101 most important steps to buy a house are:

Learning home buying process

Start by learning as much as you can about how repparttar 149103 home buying and mortgage application process works. Read as much as you can about buying a home. Check out repparttar 149104 many books in your local library that offer hints to first time home buyers. Read financial web sites on repparttar 149105 internet for tips for first time home buyers. You may even want to sign up for a class aimed at first time homeowners. Many towns and cities offer these kinds of classes, and they can be a great source of information for repparttar 149106 buyer looking for his or her first home.

Find out pre-qualified price range

It is important to find out how much you can borrow before you start looking for a home. Talk with several mortgage lenders in your area and get pre-qualified for a particular price range. The mortgage lender will be able to help you determine how much you can borrow based on your annual income. In general, mortgage lenders recommend that all home related expenses, including repparttar 149108 mortgage payment, insurance premiums and real estate taxes, do not exceed 28% of your monthly income.

Get Pre-approved for mortgage loan

The next step is to get pre-approved for mortgage financing. This is similar to getting pre-qualified for a price range, but it is a more formal process. You will need to supply proof of your income for repparttar 149109 pre-approval process to move forward. Most lenders will want to see income tax returns from repparttar 149110 past two years as proof of repparttar 149111 income you are claiming.

House hunting

After you have been pre-approved for your mortgage loan, it is time to actually start house hunting with a realtor (find out why you need to find a realtor before buying a house?). Your mortgage lender will give you a letter stating that you have been pre-approved for a mortgage and repparttar 149112 amount you are authorized to borrow. You will need to present this letter to repparttar 149113 real estate agent when you get started. It is important to get pre-approved for a mortgage loan before beginning your home search. The real estate agent and real estate company will be much more willing to work with you if they know you can afford repparttar 149114 home you are looking at. In addition, sellers will take your offer much more seriously if it is accompanied by a pre-approval letter from your mortgage lender.

Which Type Of Real Estate To Invest In

Written by Steve Gillman

There are different types of real estate, and different ways to invest in them. Which way is best is for you to decide, according to your particular needs. Here are a few ways to consider, with their advantages and disadvantages.

1. Rental houses. Advantages: One of repparttar easier ways to get started, and good long term return on investment. Disadvantages: Being a landlord isn't much fun, and you typically wait a long time for repparttar 149099 big pay-off.

2. Rent-to-own houses. Advantages: When you buy, then sell on a rent-to-own arrangement, you get higher rent, and repparttar 149100 buyer is usually responsible for maintenance. Disadvantages: The bookkeeping is tricky, and most tenants don't complete repparttar 149101 purchase (this can be an advantage too, but it does mean more work for you).

3. Low income rentals. Advantages: The same as with any rentals, but with higher cash flow. Disadvantages: The same as with other rentals, but with more repairs and tenant problems.

4. Fixer-uppers. Advantages: A quick return on your investment, and it can be more creative work. Disadvantages: Higher risk (many unpredictables) and you get taxed heavily on repparttar 149102 gain.

5. Buy for cash, sell for terms. Advantages: You get a high rate of return by paying cash to get a good price, and selling on easy terms to get a high price AND high interest. Disadvantages: You tie up your capital for a long time.

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