I have been a renter my entire life and I would like to purchase a home when I move my family to the South Bend, IN area this summer. I have no idea on what it takes to start a mortgage, what to look for in a house (especially in the midwest), any specific home damaging agents to be aware of....I appreciate your experiences and advice.

Thanks

First step would be to talk to your bank and see what mortgage options you have availible and how much of a loan they would give you.

Then do a realistic budget and see how much of a house you can really afford.  When the bank figures out how much you can afford they don't consider such option things as electricy and eating.

Then get an agent in the area and start looking.

Moving from one state to another I'd rent for a year to get a feel* for the new area. The foreclosures are comming up hard on the inside to take the lead w/interest rates rising !!

Why ya moving from Oregon?

Your local library should have several books full of home-buying tips.  Seriously.  I bought one before we bought our last house only to later see three copies in the library, along weith a dozen others.  It had good info, but I'll never use it again.  I passed it on to a friend who was house-hunting.  Could have saved $15.

Quoted: Why ya moving from Oregon?

My wife will be getting her Phd from Notre Dame in Biology all expenses paid plus a decent salary. I have been in Oregon all my life and I really like the midwest. The people in the midwest are decent, warm and friendly, ...The way Bend used to be when I grew up there.  

Well good luck!

Good luck.

Foreclosures are a terrible first time buyer market....

A lot can happen in a year.

Get an agent ( it's what I do for a living), if you want help in that let me know. I know good people in the upper west area of the country.

Is now a bad time to buy a home? Should we wait a year as suggested earlier? The difficulty is that I want a decent enough dewelling for my wife, 2yr old daughter, and our dog to reside. I was under the impression that locating a rental that is in "the good part of town" AND will take a dog might actually be more expensive month to month then making a mortgage payment.

I think a good agent can be a real asset and more than earn their commission - there are lots of poor agents out there...

My agent took the job of educating me (not to mention showing and critiquing about 50 houses to me - over the course of 6 months).  It was amazing walking into a house and having him ask questions to see if I had observed stuff.  Little things like plaster cracks (which are ok, which show problems), erosion issues (I missed that one on the house - so a house went from wanting to sign a contract to Run Forrest, Run).

That said, when it came time to sell - my agent got me 10% more per sq ft than anything else in my area - and I had competitive offires by the end of the first weekend (to be honest - we had 3 offers the first 15minutes the house was on the market).  Meanwhile the identical floorplan 2 blocks away was sitting and reducint their asking prices (a second time - had been on the market for months).


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I will also add, the only reasons I got my new house were 1) my agent knew the area well, and 2) the selling agent was an idiot who had problems postling the MSL listing images.  

My agent new the builder of the house, so was well aware what the house was going to look like before we viewed it.  Basically he told me that he had 30-40 houses to show me, but this one would be the one I would buy - he was right.  It sold at a great discount because the pictures on the MLS were SO bad nobody was even going to look at the house.
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I would probably never go with a national broker - I can not imagine them spending anywhere near the time with you that my agent did.  Likewise, the brokers that do spend time with you will be green and probably not know that much about your market or builing issues.  I think my agent made it a point to attend every building inspection of perspective properties.  Just viewing a house with him was like a mini building inspection.

We have been looking at some of the homes listed by Remax.  What is the general consensus with working through some of the larger agencies (Remax, Century21, etc....)?

Oregon born and raised, now stuck in the Midwest, dude don't do it it sucks, I'll bet you kick your self if you do. By the way IN is on the wrong side of the river to be midwest

Quoted: We have been looking at some of the homes listed by Remax.  What is the general consensus with working through some of the larger agencies (Remax, Century21, etc....)?

Karl,


Get with a Realtor ASAP. It wont cost you a dime, and you wont have to rely on gun board for your choice making information.

It makes no difference if you go with Keller Williams, RE/MAX or C21....it is the agent that is helping you not the company. The company is somewhere the agents hang their license at while they work.

C21 agents/ CWB and the such give away a ton of the money they make to the broker, silly I know..Keller Williams and some RE/MAX guys are the most motivated and best trained. If the current growth keeps up KW will be bumping RE/MAX out of the way in about 2 years.

Or go with a local mom and pop....Just get with one.

As stated, first figure out how much per month YOU are comfortable paying.

Get a copy of your credit report.  Now is the time to correct errors.  Challange any negative reports.  If the negative reporter does not respond, it must be removed from your credit report.  Your credit report determines the interest and terms of the loan you can negotiate.  Negative info costs you big $$.

Then talk to several loan brokers to see how much you qualify for and learn about the different loan options.
A fixed loan is better in most cases.   Most buyers are opting for 80/20 loans, meaning no money down.  There are pros and cons to each loan product.  Shop around.    If you are looking for a standard 30 year fixed, a credit union will likely give you the best deal.  Get "Good Faith" estimates, and pay attention to every cost.  There is no such thing as a interest free, or no fee loan.  You pay on the front end, or for the duration.

Shop around for a real estate agent.  Find one that is Capable, Professional, and Trustworthy.   They all have an agenda, which is to close the deal.  However, a good one will look out for your interests somewhat.  Don't assume the agent will give you good advice.  Don't offer asking price.  Look at the asking price, vs. selling price for the "comps" (comparable properties in the area)  Don't forget that the selling price usually includes most closing costs to be paid by the seller.  (approx 5-8 thousand)  You have to specify that in you your contract.  

Typically, the buyers agent gets 3% of the purchase amount, paid out of the sellers proceeds.  All properties are available to all brokers, so there in no advantage to stick with the big name brands.  

Your real estate agent will walk you through the process of making the offer, inpections, deadlines etc.

You will hire an inspector to check out the house, but off the top of my head, I will tell you to look out for  Flood zones, water damage, aluminum wiring, termites, and non standard contruction.

Deal only with people who will answer their phone, and are hungry for your buisiness.

Most of the country is overpriced right now, but the Midwest may be the exception. You may actually be able to find something livable, which is also affordable.  Don't forget that mortgage interest is deductable, so you get a 15% discount (approx)  vs. renting.

Above all, remember:  EVERYTHING is negotiable.    

15 year mortgage, P&I + taxes/insurance should total no more than 1/4 of your net income. You'll thank me later.

I love hearing the "Agenda" comment you guys here at ARFCOM love to toss around everytime a Real Estate thread comes up.

I assume that BillofRights has turned over all of his paychecks back to his employer or customers...



We all have an agenda. You are right, I want my deals to close, so I get paid for working. THAT is my agenda and I have no qualms about it. In fact, it is in all of my presentations. I tell people I want to close and we are going to be option driven. I also tell them I want them to be happy and when the deal closes, it is done and if I do my job right, they will have no issues with the home or the process.

Edited...I spelled ARFCOM wrong

Thanks for the info thus far.

My experience has been a realtor isn't all that much of an asset when buying a home, but I've got a lot more experience in the field than most first-time buyers would. The thing you really need is access to the MLS, in my area John L Scott offers that over the web, don't think they do in the midwest but somebody probably does.

You've gotten some good advice here, check your credit report, get pre-approved for a 15 year fixed mortgage.

Once that's done you need to narrow down the housing market to just those houses that you're interested in, that means eliminating all the houses that are out of your price range, all the mobile homes, the bad neighborhoods, and then going and looking at everything to get a feel for the market. When I've found houses I ended up buying I knew I'd offer on the house as soon as I'd seen it, I knew I was home when I walked through the door, if you don't feel that way you haven't found your house yet, and if you haven't looked at lots of houses you won't know what you're looking at.

It's always a good time to buy a house below market, and it's always a bad time to pay too much. Housing is weakening, houses stay on the market longer than they did a year ago, there's no reason to rush, but there's no reason to put it off either if you find a good deal.

I payed about 70% of the assessed value for the house I live in now. Don't buy a cheap tract house, those neighborhoods are ghettos waiting to happen. Buy the cheapest house in the best neighborhood you can afford, preferably a neighborhood where all the houses are different, there's no homeowners association, and the lots are big enough to do some gardening and such.

I consider a good garden plot, a good well, a woodlot for firewood, a garage, and so on MAJOR assets to a property, assets which are undervalued in the current market.

HTH.

Quoted: I love hearing the "Agenda" comment you guys here at ARCOC love to toss around everytime a Real Estate thread comes up. I assume that BillofRights has turned over all of his paychecks back to his employer or customers... We all have an agenda. You are right, I want my deals to close, so I get paid for working. THAT is my agenda and I have no qualms about it. In fact, it is in all of my presentations. I tell people I want to close and we are going to be option driven. I also tell them I want them to be happy and when the deal closes, it is done and if I do my job right, they will have no issues with the home or the process.

Geeze, a little sensitive are we?

I meant it exactly as you described it.  The first time buyer should be aware that nobody is responsible for his interests but himself.  As a Realtor, you are no doubt a great asset to your buyers, but at the end of the day, your responsibility is to yourself and your family.    Don't feel bad about it.  Everybody has an "Agenda"

What's wrong with what BillofRights said?  If it's not an agenda, it's their objective, it's what they work to accomplish: close the deal.

I've been investing in real estate since 2002, I've been very fortunate that one of my good friends is a broker and he handles all the buying and selling for me.  In the process I've seen good agents/brokers and indifferent, lazy, unprofessional ones that just want to close the deal, even at the detriment of their clients.  My friend/broker always does the right thing, he's got enough money to never work again but he does it for fun, he ain't relying on my business (or anyone else's) to put food on the table.

Many agents don't do it for the love of the profession, and it shows.  It's when an objective becomes an agenda, they'd do what they can to push you for their own gains.

I rely on him to do the research and find investment opportunities, if you don't have somone like that, you have do your homework.  So far all of the posts have been right on (BillofRights' especially )

Try to get past what you see, stuff like paint, carpet, etc., these can always be changed without a lot of expenses.  Houses that are all fixed up cost more than ones needing some work, I almost always get a great deal on properties that others passed on, fixed it up a little, and pay less than their market value.  I don't have time to do the fixer upper thing so I'm not talking any major remodelling.  People are usually rather short sigted and want everything their way from the start, and leave great deals to those of us that can see further than what meets the eye