Tina McManus' Blog
A home inspection represents a key stage during the homebuying journey. This inspection enables you to examine a house with a professional property inspector. And if you discover minor or major property issues, you can ask a seller to perform repairs. Or, you may choose to reduce your initial home offer or rescind your proposal.
Ultimately, it pays to be diligent during a home inspection. If you perform an in-depth assessment of a house, you can understand whether this residence is the right choice.
On the other hand, there may be property problems that you identify during a home inspection that you won't ask a seller to repair. These issues may include:
1. Cosmetic Problems
If you ask a home seller to perform cosmetic repairs, the seller may choose to walk away from your homebuying proposal. And if this happens, you could lose your dream house to a rival homebuyer.
There is no need to jeopardize a home sale due to a cracked floor tile, a deck that needs to be stained or other cosmetic problems. Instead, plan to perform cosmetic repairs on your own.
In addition, keep in mind that many cosmetic issues are quick and easy to fix and won't require you to break your budget. This means you likely will have no trouble completing myriad cosmetic repairs after you close on a home.
2. Loose Fixtures
A loose doorknob or light fixture can be frustrating. And as you walk through a house during an inspection, you may feel like repairing a loose fixture is a top priority.
Loose fixtures generally require simple hand tools to repair, and problems with these fixtures frequently can be solved in just minutes. As such, you may want to focus your attention on bigger and potentially more expensive home repairs as you determine which property repair requests to submit to a seller.
Of course, if a loose fixture creates a safety hazard, you should not hesitate to ask the seller to fix this problem. Because if a hazardous fixture remains in place, it may put your health and safety at risk.
3.Non-Functional Light Switch
A non-functional light switch may raise red flags as you inspect a house. But in many instances, this problem is minor.
If you notice a non-functional light switch during a home inspection, there usually is no need to worry. In fact, a property inspector typically can tell you whether a home's electrical system is safe to use and up to code.
For homebuyers who are uncertain about how to proceed with a residence following an inspection, it pays to consult with a real estate agent. This housing market professional can offer expert tips to help you make informed decisions at each stage of the homebuying journey.
Consider your potential property repair requests following a home inspection. By doing so, you can prioritize major property repairs and increase the likelihood that you and the seller can find common ground as you work toward finalizing a purchase agreement.
If you’re a first-time buyer, odds are you’ve never seen or heard much about mortgage applications. However, for something as important as buying a home, it pays off to go into the process knowing what to expect.
Mortgage applications aren’t all that complicated in and of themselves. Most of the time, your chosen lender will walk you through the process and answer any questions that arise. However, complications do arise when it comes time to provide documentation on things like your income.
To make things easier for your first application, I’ve put together this list of frequently asked questions that first-time buyers often have about their mortgage application process.
Will applying for a mortgage hurt my credit score?
Mortgage lenders will run a credit inquiry to help determine your lending eligibility. There are two types of credit inquiries: hard and soft. A soft inquiry is a quick credit check that doesn’t affect your credit score. A hard inquiry, on the other hand, does. This means your score will be lowered slightly for a few months and then will bounce back.
Mortgage lenders run both types of inquiries. For quick, pre-qualifications, lenders typically run a soft inquiry. Then, as you progress through the approval process, they’re run a detailed credit report (hard inquiry).
What information should I have available?
Lenders will ask you for various documents. The most common things they will ask for include proof of income in the form of W-2 forms from the previous year and your most recent pay stub. They will also require a record of your other debts, including student loans, auto loans, credit card debt, and any other outstanding debt that you owe. Finally, they will ask for an inventory of your assets. This could include investments, properties, auto titles, and more.
What if I don’t work a conventional job?
People who are self-employed or have unconventional income can still qualify for a loan and will still be required to show proof of income. Lenders may ask for Form 1099 records, tax returns, or any other record or proof of income you have available.
How long does it take to complete an application?
Mortgage applications can be completed as quickly as you gather the required documentation. However, there’s more to getting approved for a mortgage than filling out an application. There will be time needed to process the application, and underwrite your mortgage. This entire process typically takes between 30 and 45 days.
Is it safe to apply for a mortgage online?
Most lenders allow you to start the application process online and their online portals are typically secure. Make sure you check your browser window to ensure that the connection to the site is secured, and you should have nothing to worry about.
Keep in mind that most online applications are designed to get you prequalified and on your way to getting a mortgage. So, if you want to avoid getting calls from the lender, you might not want to enter any data until you know you’re interested in borrowing at this time.
If you’re hoping to buy a home in the near future there are several financial prerequisites that you should aim to meet. Ideally, you’ll want a sizable down payment, a verifiable income history, and a good credit score.
It takes time to build credit. For most people, it can be several months or even years before they see a double-digit change in their credit score. However, if you have a low credit score and want to give it a quick boost, there are ways you can make a big difference.
But first, why should you focus on your credit score?
Credit scores and mortgages
When you apply for a mortgage there are several factors that your lender will take into consideration. One of their top concerns will be your credit score. This score is like a snapshot of your financial reliability. It tells lenders how much risk is involved in lending to you.
As a result, lenders will increase your interest rate if you are high risk and lower it if you are lower risk. To be a low risk homeowner, you’ll want your score to be in the high range, (usually 700 or above).
Credit change potential
Depending on your financial history, it can be more difficult to raise your score in a shorter period of time. If you are young, don’t have a long credit history, or haven’t had many bills to pay in your lifetime, your score will be more malleable than someone who has had low credit for years due to late payments.
In the United States, you have to be eighteen to open up a credit card or take out a loan by yourself (this is different from getting a loan co-signed by a parent or guardian). You can also ask your parents or guardians to add you as an authorized user of their credit cards. This will let you build credit without having to settle for the high interest rate credit cards you would be eligible for.
If you happen to have a low score (anywhere between 300 - 600), the good news is you can achieve a larger change over a shorter amount of time than someone who already has a high score.
So, how do you achieve that change?
One of the easiest ways to quickly improve your score is to check for errors in your credit report. You can get a free report each year from the three main credit bureaus--Equifax, TransUnion, and Experian.
Look out for bills that have been mistakenly put under your name and for collections that shouldn’t be on your account.
Avoid new credit
One thing that can do short-term harm to your credit score is opening or attempting to open new lines of credit. That can be a store card, a loan, or getting your credit checked by a lender.
If you want to build credit quickly, making several inquiries could land you with a lower score than where you started.
Pay your regular expenses with credit
A good way to gain credit points in a few months is to pick a monthly expense to use your credit card for. Pay off your full balance at the end of each billing cycle to earn the most points while avoiding building up too much interest.
Buying a home will likely be one of the largest financial decisions you will make in your lifetime. While this may seem scary at first, it’s worth noting that buying a home can also be a valuable financial investment.
When it comes to preparing to buy a home, many people just wait until they run out of room in their apartment before deciding that they need to upgrade to a home. A better approach, however, would be to start planning for your first home a year or more in advance.
Saving for a down payment is a vital step to making the best long-term financial decision. A larger down payment can help you pay off your home sooner, pay thousands or tens of thousands less in interest, and start using your home equity as an asset.
But, saving for a down payment is easier said than done. So, in this post, we’re going to talk about some of the ways you can aggressively save for a down payment so that, when the time comes, you can achieve long-term financial security from your investment.
Setting your savings goals
The first thing you should be thinking about when saving for a down payment is what your goals are in a home. Setting realistic goals in this phase will make saving for your down payment more feasible and less discouraging.
Think about what you really need from a home at this point in your life and compromise where you can.
Remember that on top of your monthly mortgage payments, you’ll likely also be paying for taxes, insurance, utilities, homeowners association fees, and more.
Save on a timeline
When setting your savings goal, make sure you’re aware of the timeframe you’re working with. If you want to buy a home next year, you’ll need to focus on short-term savings options. However, if you’re okay with renting for the next 5 years, investing your money could be a better option.
Lock away your savings
Treat your down payment savings like an emergency fund. Open a separate account, automatically deposit a portion of your pay into the account, and never withdraw from it. To do this, you will, of course, need to already have an emergency fund with a month’s expenses in it.
However, once you’ve established your emergency fund, start immediately depositing into your savings account.
Pay off credit cards
It may seem like saving for a down payment is more pressing than paying off old debt. However, the numbers will show that making interest payments on your credit cards is essentially throwing away money that could have been used toward your down payment savings.
Adjust your spending habits
While it isn’t easy to start spending less once you’ve built a standard of living, there are ways to spend less money and still lead a fulfilling life. Think about where your money goes each month, including bills and services you might pay for.
Now could be the best time to cut the cord and start using a service like Hulu to save $50 or more each month.
Time for a raise?
If it’s been some time since your last pay raise, now could be an ideal time to speak with your employer. To improve your chances of success, don’t discuss reasons outside of work that might be influencing your decision to ask for a raise (such as saving for a down payment). Rather, back up your request with evidence of your accomplishments at work.
Setting up and completing a home inspection may seem like a long, arduous process. However, an inspection is a must-have for any homebuyer, at any time.
With a comprehensive home inspection, you can identify any potential problems with a house. And if you don't like what you find in an inspection report, you can always ask a home seller to complete improvements or reduce his or her asking price. Or, if you prefer, you can walk away from a home sale altogether.
Ultimately, there are several steps that you'll want to follow to conduct a home inspection, and these are:
1. Find an Expert Home Inspector
When it comes to a home purchase, there is no need to leave anything to chance. Fortunately, if you hire an expert home inspector, you can avoid the risk of missing possible issues during a home inspection.
Not all home inspectors are created equal, so you'll want to evaluate all of the options at your disposal.
To kick off your search for a home inspector, browse the web. This will enable you to find dozens of home inspectors in your area and assess online client reviews.
Also, don't hesitate to ask a home inspector for client referrals. If you obtain client referrals, you can better understand whether a home inspector can match or exceed your expectations.
2. Attend Your Home Inspection
Although homebuyers are not required to attend a home inspection, it generally is a good idea to walk with a home inspector as he or she examines your residence. By doing so, you may be able to gain home insights that might not be included in a home inspection report.
A home inspector may notice home problems that range from minor to severe. The inspector's job is to identify a problem and include it in a home inspection report.
If you attend a home inspection, an inspector may be able to provide you information about potential home problems, along with an estimate about how much assorted home repairs may cost. That way, you are better equipped than ever before to determine whether potential home problems could deter you from buying a house.
3. Evaluate the Home Inspection Report
A home inspection report can play a key role in the homebuying process. If you evaluate this report closely, you can learn about a home's strengths and weaknesses and decide whether to proceed with a home purchase.
If you have questions regarding a home inspection report, you can always follow-up with the inspector that provided the assessment. This will allow you to obtain the insights that you need to make an informed homebuying decision.
Lastly, it certainly helps to collaborate with a real estate agent before, during and after a home inspection. A real estate agent will guide you along the homebuying process and ensure that you can get the best possible results.
Follow the aforementioned steps, and you should have no trouble conducting a home inspection.