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Last Updated: Jul 2nd, 2008 - 21:15:22 |
(NAPSI)-For many, the American Dream begins with owning a home. Having a place of your own to call home can be one of your most prized possessions and the cornerstone of your wealth.
With the inventory of available homes increasing, and in many areas, prices stabilizing, now might be the time to consider buying a home.
GMAC Mortgage offers the following seven steps to owning a home.
• Prepare for Success-Before you buy your first home, make sure you are prepared for success. First, start by saving for a down payment. For many first-time homebuyers, a loan insured by the FHA is the ticket to homeownership. Under FHA rules, you will need at least 3 percent of the purchase price as a down payment. Also, don't forget to have financial reserves in place for unforeseen repairs and be prepared to put the time and effort into maintaining your home.
• Get Preapproved-Before you begin the home-buying process, work with a loan officer who can help you understand exactly how much you can reasonably and responsibly afford.
"By getting preapproved, you will receive a conditional loan commitment for up to a certain amount from your lender before you have found a home, based on a review of your credit and finances," says Jim Ferriter, executive vice president for GMAC Mortgage. "Preapproval makes your home search more effective by allowing you to focus only on the homes you know are in your price range."
• Hunt for a Home-Once you know your price range, find a real estate agent you trust, who can work with you to find a perfect home. Try to look at a wide variety of homes and be sure to consider the neighborhood, the schools, how much room you need now and in the future, and how different types of homes will suit your lifestyle.
• Make an Offer-Once you've found a home that you want to buy, your real estate agent will work with you to develop an offer based on recent sales in the neighborhood, the overall market conditions in your area, and the current condition of the house. Once you make an offer, your real estate agent will present it to the seller or seller's agent.
At that point, the seller will either accept, reject or counter your offer with changes in some of the terms. You may either sign or counter the offer. When both parties agree to the terms, you will then sign a purchase agreement, which becomes a valid contract.
• Finalize Your Financing-Once you've selected your new home, update your preapproval application with complete property information and secure your home loan.
"You will need to confirm your choice of loan programs and should consider how long you plan to stay in your home to help determine the right loan for you," continues Ferriter. "Your mortgage lender and loan officer can work with you to show you the options that are available."
• Get a Home Inspection-Since buying a home is going to be one of the largest investments you will ever make, have the home inspected before making the purchase. Choose a qualified inspector who can thoroughly evaluate the condition of the potential new home. The inspector should evaluate all exterior and interior structural components of the home and all major systems, including heating, cooling, plumbing and electrical.
• Closing-Once you've found your home, agreed on a price with the seller and had the home inspected, the closing marks the end of the process and you will officially take ownership of the property. Remember to take into consideration that you will have closing costs to pay, which range from lender and appraisal fees to third-party fees to prepaid items that must be paid to your lender in advance.
If you think homeownership is for you, now might be the time to make your move. For more information on the process, visit http://www.gmacmortgage.com or call GMAC Mortgage at (800) 888-GMAC.
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