Whether you are a first time home buyer, or looking to find your dream home, the process can be confusing. You’ve picked a great time to buy, with interest rates at historical lows, and the selection of homes available is terrific, with over 4300 single family homes available. In addition, the FHA loan limit for El Paso County is $325,000, allowing low down payment financing (3.5%) as an option for even more buyers, and making even more of our homes for sale eligible for this great program. First time home buyers have some programs available with an even lower down payment required.
Search the Colorado Springs MLS (Multiple Listings Service) .
Do you find all the jargon in real estate confusing? Check out this blog post about Real Estate Alphabet Soup, it will help spell things out a little clearer for you!
Why Buy at All?
While home ownership in the United States has dropped a bit since 2007, over 60% of Americans own their own home. They do so for many reasons, but here are a few:
1. Control of your environment. Homeowners set their own pet policies, smoking rules, determine their own decor, maintain the property at the level they wish, all with minimal interference. Renters have to ask permission of their landlords for a host of things, and live with many things that are not the way they really want them. You can also be pickier in selecting a place initially, since there are far more homes for sale than for rent at any given time.
2. Equity. Homeowners achieve equity by paying off their loan, as well as appreciation. Home equity is the number 1 asset most people have at retirement. Renters have boxes of receipts, in many cases totaling much more than the cost of a home.
3. Stability. Homeowners move when they want to. Renters may have to move whenever the landlord decides not to renew their lease, when the rent gets too high, or when they can’t stand the level of maintenance the landlord has decided on.
4. Taxes. Homeowners take advantage of 2 of the most important tax benefits left in the US Tax Code for individuals. Mortgage interest (the largest portion of a house payment) is tax deductible. The gain on the sale of a primary residence is generally not taxable. For equivalent income and housing expenses, renters pay much higher taxes.
5. It’s Easy. You’d probably be surprised to discover that in many cases, buying a home is easier than renting one. Landlords want to know more about you than banks these days. And with 1st months rent, last months rent, and deposit all being pretty commonly due BEFORE you move in, many times you can buy a home with a comparable house payment, with less cash out of pocket to move in. There are so many different ways to buy with no down payment, saving for a down payment is of far less use than having good credit scores.
Is It Ever Better to Rent?
Like everything, there are always exceptions to the rules. The best reasons to rent would be:
1. You are planning on moving in less than 2 years. It generally takes 2 -3 years for buying to be advisable, because it costs money to sell, and you need some appreciation time to cover the cost of selling.
2. Your job, credit or other circumstances are in the middle of major change. If you are just months away from a major promotion, it sometimes makes sense to wait so that you can afford something closer to what you really want. The same is true of credit score issues, if you have issues that can result in major improvement in your credit scores by waiting a little while, it is often better to fix your credit first, and then buy. Visa versa, if you may be in for a negative change at work, it may make sense to “ride it out” and make sure you will still be able to afford a place.
The Purchase Process
The Loan: The first step in purchasing a home is to speak to a lender and find out your options. Keep in mind that mortgage interest typically adds up to more than twice the cost of your home. Having good information, and resources for your mortgage is critical. Please visit our Mortgage Center for more mortgage information.
The Agent: Next, find a Real Estate Agent to represent YOUR interests. Many buyers take the approach of calling the agent who listed a house they are interested in. Fewer than 20% of the homes available ever even get seen in a homes magazine or newspaper ad, making this process inefficient and ineffective. While it may seem to be the easiest way to find an agent, the seller’s Realtor (R) has been employed by the seller, and they represent the seller’s interests first and foremost. Our Buyer Agency Agreement states that we, as the BUYER’S BROKER will act on behalf of the buyer and their interests. In addition, with thousands of homes on the market, it can take a lot of work and can be very inefficient to call each listing agent and set an appointment to see 1 home at a time, especially when most of them are not even that easy to find. As a buyers agent, we typically see 4 homes in an hour, and can quickly go from house to house, discussing and comparing each to the other, instead of spreading that process out over weeks and weeks of searching, waiting for call backs, etc.
The tools which an agent utilizes to help find his buyers a home is very essential, as well. We currently have many internet tools, to give our buyers the most complete information on the current inventory. For years, real estate agents have “held the key” to the real estate market, making it almost impossible for buyers to do research on the homes that are currently for sale. We believe buyers make better decisions if they are informed, so we offer websites with address, multiple photos, visual tours, dimensions, and almost everything else you can think of. We will not hold out information from you. If we know something about a property, we let you know it too.
Your real estate agent will discuss with you in depth what you are really looking for, and it goes way beyond the house. Neighborhoods, schools, commute patterns, climate issues, hobbies, and more, are all part of the discussion so that your agent can best advise you in the home search process. Need a good agent? Call me, Rick Van Wieren at 888-568-6784 or 719-590-4768, or email me at email@example.com
The Homes: Next, you find your house! Your agent will use the MLS system to help identify homes for you, but there are many ways you can do some of this “homework” on your own as well. Please use the link below to look through our entire MLS with addresses and multiple photos.
Search the Colorado Springs MLS and see what is for sale in your price range.
The Contract: Once you have narrowed down your criteria and the houses you want to be shown, we take you out to see them. And when we find the one that you like the best, we do some preliminary “due diligence”, such as finding out how much the seller paid for the home, what they owe, when they last reduced the price, what other homes nearby have sold for, and we write the contract. If and when that offer is accepted, we handle ALL of your paperwork and coordinating with lenders, agents, inspectors, sellers and title companies. We work with and for you all the way until closing.
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