Shop… Shop… Shop… Interest Rates are very competitive, so be sure to check with banks, financial institutions, and even the internet.The rates are the lowest in 41 years.

The market may never be better than it is right now. It can go up and down depending on the area. Your agent may be able to advice you regarding the market in your area.

Purchasing a new home is one of the single most important investments you will make. Your lender can evaluate your financial situation and advise you by means of loan pre-qualification the maximum amount you will qualify for based on your current income and expenses.

Today's loan products offer a wide range of down payment choices. Conventional loans are now available with 0 down payment. The seller of the property can also pay up to 3% of the buyer's closing costs. FHA loans require a minimum of 3% down, and the seller can pay up to 6% of the buyer's closing costs. A VA Loan requires 0 down, and the seller can pay all closing costs. There are over 100 different types of loans with different terms; a lender will help you find the right one for your situation.

Yes. It is definately to your advantage to consult a lender and let them evaluate your financial situation before looking for a home. Your eventual offer will be stronger if you already have a pre-qualification letter and know what your loan amount you qualify for.

Your monthly payment depends on several factors, the rate of interest, monthly property tax, and monthly insurance premiums. If you are required to have Private Mortgage Insurance (required if you put less than 20% down on your home), this is also added in your monthly payment. Example:A home loan amount of $100,000 at an interest rate of 6.00%, plus estimated taxes,insurance,and mortgage insurance would be around $970 per month for a 30 year loan.

The home should have a whole house inspection, and/or pest & dry rot report. An appraisal insures you and the lender the property is worth the price.

Call the local police department for information regarding crime.

Average cost for electricity, gas and wood heat varies greatly based on where the home is sited, number of windows, insulation, square footage, and type of heat as well as individual lifestyle. Ask you Realtor about obtaining a history of electrical costs for a particular property.

Price is often negotiable. The only way to know is to write an offer at a price acceptable to you. There will always be some motivation behind the Seller's decision to sell their property, and they may or may not show flexibility. But, a good Realtor will make every effort to place the home on the market with a price that is competitive and priced to attract buyers.

You should choose a Realtor who specializes in the type of property or area you are looking for, as well as interviewing to see how comfortable you feel with them. Above all, when you select an agent, tell them honestly your needs and limitations. Agents will reward your loyalty to them with hard work on your behalf.

Typically not. Realtors are usually paid by the seller. In some rare circumstances, however, you may be responsible for your realtor's fees. Make sure you discuss these possibilities with your realtor.

It depends on your circumstances and lifestyle, but in most cases it is better to own. When you own a property, your monthly payments go toward an investment. Over time property values typically appreciate, making you money. In addition, the interest and taxes on your mortgage payments are tax deductible.

A competitive market, or hot market, is usually defined as one where there is a relative shortage of marketable properties coupled with an increase in demand for those properties. There are three things you need to do in order to buy successfully in such a market. First, you need to make sure you are up to speed with what your buying dollar will purchase. In other words, you need to be familiar with the Fair Market value for the type of property you want in the area that you are looking in, so you know a good buy when you see it. Secondly, you need to have financing pre-qualification in place. Thirdly, you need to have a quality, experienced Realtor on your team to help educate you to the market, find the right property and position your offer to purchase for success. In this type of market it is not unusual to have multiple offers on the same property brought in at the same time.

He or she should be licensed by the Texas Real Estate Commission. You may ask to see proof of their license.

It varies depending on the location and type of property (owner occupied or investment). The first step is to research and acquire financing. A pre-qualification takes only a few minutues for an owner occupied property, and can close in 2 to 4 weeks, sometimes sooner. The lender will work closely with you to get your loan closed as soon as possible.

A buyer’s market occurs when home sales are slow. Here are some of the ways to determine if the home market in your area is a buyer’s market: -Is it taking longer and longer to sell homes? -Are foreclosures increasing? -Are there large reductions in home prices? -Has there been a decline in the number of building permits issued? -Is unemployment increasing? These factors indicate a “soft” market for home sales. A soft market tends to make sellers anxious and puts buyers in a stronger position than sellers. In a soft market, buyers have many homes to choose from and can demand special considerations from sellers.

A standard homeowners policy may protect against all or some of the following; fire, lightning, wind, storms, hail, explosions, riots, aircraft wrecks, vehicle crashes, smoke, vandalism, theft, breaking glass, falling objects, weight of snow or sleet, collapsing buildings, freezing of plumbing fixtures, or electrical damage. Always check with your insurance agent to make sure exactly what the policy you are considering covers. Insurance experts recommend that homeowners obtain insurance equal to the full replacement value of the home. On a 2,000-square-foot home,for example, if the replacement cost is $80 per square foot, the house should be insured for at least $160,000. For personal items, homeowners can increase their coverage beyond the depreciated value of items such as televisions or furniture by purchasing a "replacement-cost endorsement" on personal property. Some experts recommend an inflation rider, which increases coverage as the home increases in value.

Because many buyers prefer to move in the spring or summer, the market starts to heat up as early as February. Families with children are anxious to buy so they can move during summer vacation, before the new school year begins. The market slows down in late summer before picking up again briefly in the fall. November and December have traditionlly been slow months, although some astute buyers look for bargains during this period.

Interest and property taxes may be deductible on a second home and investment property if you itemize. Check with your accountant or tax adviser for specifics.

Any points you or the seller pay for your home loan are deductible for that year. Property taxes and interest are deductible every year. But while other home-buying costs (closing costs in particular) are not immediately tax-deductible, they can be figured into the adjusted cost basis of your home when you go to sell (any significant home improvements also can be calculated into your basis). These fees would include title insurance, application fee, credit report, appraisal fee, service fee, settlement or closing fees, attorney's fee, document preparation fee and recording fees.

The mortgage interest deduction entitles you to completely deduct the interest on your home loan for the year in which you paid it. You must itemize deductions in order to do this, which means your total deductions must exceed the IRS's standard deduction. Another point to remember is that the amount of interest on your loan goes down each year you pay on your mortgage (all standard home-loan formulas pay off interest first before significantly paying into principal). That's why paying extra on your principal every year can help you pay off your loan early.

Property taxes are what most homeowners in the United States pay for the privilege of owning a piece of real estate, on average 2.5 percent of the property's current market value. These annual local assessments by county or local authorities help pay for public services and are calculated using a variety of formulas.

Property taxes on all real estate, including those levied by state and local governments and school districts, are fully deductible against current income taxes.

Lower interest rate allows you to borrow more money than a high rate with the same monthly payment. Interest rates can fluctuate as you shop for a loan, so ask lenders if they offer a rate "lock-in" which guarantees a specific interest rate for a certain period of time. Remember that a lender must disclose the Annual Percentage Rate (APR) of a loan to you. The APR a mortgage loan by expressing it in terms of a yearly interest rate. It is higher than the interest rate because it also includes the cost of points, loan origination fee and other closing costs associated with the loan.

If interest rates drop significantly, you may want to investigate refinancing. Most experts agree that if you plan to be in your house for at least 18 months and you can get a rate 2% less than your current one, refinancing is smart. Refinancing may, however, involve paying many of the same fees paid at the original closing, plus origination and application fees.

Established by your lender, an escrow account is a place to set aside a portion of your monthly mortgage payment to cover annual charges for homeowner's insurance, mortgage insurance (if applicable), and property taxes. Escrow accounts are a good idea because they assure money will always be available for these payments. If you use an escrow account to pay property taxes or homeowner's insurance, make sure you are not penalized for late payments since it is the lender's responsibility to make those payments. Escrow of insurance and taxes are always required if you put less than 20% down payment on the purchase of your home.

It's not required, but it's a good idea. Following the inspection, the home inspector will be able to answer questions about the report and discuss problem areas. This is also an opportunity to hear an objective opinion on the home you'd like to purchase and it is a good time to ask general maintenance questions.

If your home inspector discovers a serious problem, another more specific inspection may be recommended. It's a good idea to consider having your home inspected for the presence of a variety of health-related risks like radon gas, asbestos, or possible problems with the water or waste disposal system.

If a qualified real estate professional is involved, you will probably not need the services of an attorney, unless it is a complicated sale. Texas does not require one, but if there is complex paperwork and there is no Realtor involved, you may want to hire a lawyer to help you. A lawyer can review contracts, make you aware of special considerations, and assist you with the closing process. A real estate agent may be able to recommend a lawyer. If not, shop around. Find out what services are provided for what fee, and whether the attorney is experienced at representing homebuyers.

Yes. A homeowner's insurance policy is required at closing, so arrangements will have to be made prior to that day. Plus, involving the insurance agent early in the home buying process can save you money. Insurance agents are a great resource for information on home safety and they can give tips on how to keep insurance premiums low.

Be sure to shop around among several insurance companies. Also, consider the cost of insurance when you look at homes. Newer homes and homes constructed with materials like brick tend to have lower premiums. Think about avoiding areas prone to natural disasters, like flooding. Choose a home with a fire hydrant or a fire department nearby. Other ways to lower insurance costs include insuring your home and car with the same company, or adding home security devices.

Always check to see if the house is in a low-lying area, in a high-risk area for natural disasters (like earthquakes, hurricanes, tornadoes, etc.), or in a hazardous materials area. Be sure the house meets building codes. Also consider local zoning laws, which could affect remodeling or making an addition in the future. Your real estate agent should be able to help you with these questions.

Earnest money is a cash deposit you submit with your offer on the property to demonstrate your seriousness about buying the home. It is not mandatory, but is usually between $100.00 - $1000.00%. (though the amount can vary with local real estate firms and seller requriements). If your offer is accepted, the earnest money will be applied to your down payment or closing costs. If the offer is rejected, your money is returned to you. If you back out of a deal, you must forfeit the entire amount.

Yes. By sending in extra money each month or making an extra payment at the end of the year, you can accelerate the process of paying off the loan. When you send extra money, be sure to indicate that the excess payment is to be applied to the principal. Most lenders allow loan prepayment, though you may have to pay a prepayment penalty to do so. Ask your lender for details.

Yes. Lenders now offer several affordable mortgage options, which can help first-time homebuyers overcome obstacles that made purchasing a home difficult in the past. Lenders may now be able to help borrowers who do not have money saved for the down payment and closing costs, have little credit or a poor credit history, have quite a bit of long-term debt, or have experienced income irregularities.

The lender will pre-qualify you using automated underwriting. The lender will ask you to furnish documentation supporting information disclosed on your application. The lender then submits your entire file which includes the property appraisal to an underwriter for final approval. This process takes between 1-3 weeks. If the underwriter needs more information after they review the application, the lender will contact your for the additional documents. The sooner you can provide the information, the faster your loan will be processed. Once all the information has been verified, the lender will call you to let you know the outcome of your loan application. If the loan is approved, a closing date is set up and the lender will review the closing process with you. And after closing, you'll be able to move into your new home.

The closing agent at the title company will review the Settlement Statment with you that lists all charges related to the real estate purchase. These include the appraisal fee, survey (if required), title company fees, lender fees, pre-paid interest, taxes, insurance, etc. They will have you sign all documents related to the home loan, and collect any amounts due from you in certified funds. Once you're sure you understand all the documentation, you'll sign the mortgage, agreeing that if you don't make payments the lender is entitled to sell your property and apply the sale price against the amount you owe plus expenses. You'll also sign a mortgage note, promising to repay the loan. The seller will give you the title to the house in the form of a signed deed. The deed and mortgage will then be recorded in the County Clerk's Office, and you will be a homeowner.

When a purchaser has been "pre-approved" for a mortgage, the lending institution has already analysed his or her financial situation, and determined the amount of money they would qualify for. This amount, plus your down payment, will give you an idea as to how much you are able to afford in the purchase of your home.

Besides knowing your comfort level of affordability, being "pre-qualified" could help in the presentation of your offer. For example, if there are two offers on a property, the offer that has the best terms and conditions for the owner, would be accepted. Thus, if both offers were identical, except for subject to financing, the offer without the pre-qualification letter would be looked at more carefully by the owner. Because you are "pre-qualified", the owner of the property may give your offer more weight.

No. The term of a mortgage refers to the period of time that your interest rate is calculated before renewing. For example, 6 month, 1 year, 5 year, etc. Before the pre-determined term expires, you renew at the current rates in effect at that time. The amortization of a mortgage means the number of years (or months) that it takes to repay the mortgage by making regular mortgage payments. This is calculated with the current rate of interest you have chosen with the term. Then your payments (principle and interest) are blended over the amortization of the mortgage.

Talk to your lending institution to find out, in writing, what pre-payment privileges you are allowed on your mortgage. Some pre-payment privileges that may be available, are: Paying an extra 10% of the original amount of the mortgage, or less (every little bit extra, saves), on each yearly anniversary date. Making bi-monthly payments instead of one payment a month. Reducing the amortization period upon renewal. By taking advantage of these privileges, you could save thousands of dollars in interest over the life of the mortgage, and own your home quicker

Here are a few: The Property Transfer Tax of 1% of the 1st $200,000 and 2% of the balance. (First time buyers may be exempt) Lawyer, appraisal, survey, inspection, mortgage application fees must be paid in cash on completion. Mortgage Insurance fees, may be added to the mortgage principle. Any statement of adjustments calculated by your lawyer (taxes prepaid by owner, etc.). This is a basic expense list. Each property purchased will have different expenses. Check with the appropriate authorities, or better still, ask a realtor to assist you.

Ask you family, co-workers or friends for referral to a Realtor. Select a Realtor that you feel most comfortable with, and arrange to view properties with him or her. By using one Realtor, you may reduce the time necessary to find that special property, because that Realtor will know and understand your wants and needs, thus you will avoid viewing unnecessary properties. Also, when you have found that special property, you and your Realtor will have established a rapport, and you will feel more comfortable in making an offer with someone you have spent a lot of time with, and who understands your financial situation.

After viewing properties that best suit your needs, you will develop a sense of value of one property over another. Your Realtor will also assist you in determining an offer, by showing you comparable sales or similar properties for sale now, thus establishing a range of values for the property you are interested in. When you are ready, realtor will write an offer with the proper terms and conditions that suit your needs, and negotiate with the seller on your behalf.

With the exception of price, bed/bath and square footage, all search criteria are preferences. These preferences function like a sort criteria, putting homes that meet your preferences at the top of the search results, without excluding homes that only partially meet your preferences.

A real estate agent is a realtor when he or she is a member of the National Association of Realtors, The Voice for Real Estate® -- the world's largest professional association. The term realtor is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of Realtors and subscribes to its strict Code of Ethics. Founded in 1908, NAR has grown from its original nucleus of 120 to today's 720,000 members. NAR is composed of residential and commercial realtors who are brokers, salespeople, property managers, appraisers, counselors and others engaged in all aspects of the real estate industry. Members belong to one or more of some 1,700 local associations/boards and 54 state and territory associations of realtors. They can join one of our many institutes, societies and councils. Additionally, NAR offers members the opportunity to be active in our appraisal and international real estate specialty sections. Realtors are pledged to a strict Code of Ethics and Standards of Practice. Working for America's property owners, the National Association provides a facility for professional development, research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right to own real property.

Real estate agents or brokers are generally paid through the sales commission paid by the seller when a transaction closes. Agents have expenses and financial obligations just like you, so it will be to your mutual benefit if you choose a real estate agent and stick with that person. The agent will respect your loyalty and respond with a sincere commitment to you.

Four key advantages are: Mortgage interest is tax deductible. Real estate taxes are tax deductible. Local tax benefits are available in many areas. You can enjoy tax-free profits of up to $500,000 from the sale of a primary residence that you have occupied for two of the last five years if you are married and filing jointly. If you are single or married and filing separately, you can enjoy tax-free profits up to $250,000. Moreover, you can use the exclusion as often as you meet the qualifications.

Five key benefits are: You build equity over time, which you can take in cash when you sell your home. The profits from home investment are often greater than from many other investments. Because you can borrow against it in most states, home equity can be a source of emergency funding. Land appreciation adds to the value of your home. For many, home ownership is an important part of retirement planning.

Appraised value is an opinion of a property's market value, based on an appraiser's knowledge, experience and analysis of a property. Comparative market analysis is an informal estimate of market value performed by a real estate agent or broker. It is based on sales of similar homes in the area and generally offers a range of values, including probable market value.

Typically, the common law obligations owed to you are to: Put your interests above anyone else's; Keep information confidential; Obey your lawful instructions; Report anything that would be useful; and Account to you for all money involved. Nonetheless when you start working with a realtor, ask for a clear explanation of your state's current regulations so that you know where you stand on these matters.

Foreclosure proceedings usually begin after a borrower has skipped three mortgage payments. The lender will record a notice of default against the property. Unless the debt is satisfied, the lender will foreclose on the mortgage and proceed to set up a trustee sale.

The first factor is a date agreeable to both Buyer and Seller for closing and possession. This date is set when the offer to buy is negotiated and can be changed after that only by agreement of both parties. Once the date has been established, the next factor is the contingencies in the offer to buy. These generally includes financing and inspections. You must allow enough time to release these contingencies. Depending on the type of financing, this can take a few days up to thirty days. Inspections can take from a few days up to a couple of weeks. The final factor is the legal work that needs to be done prior to closing. The Seller must have the abstract (history of title) brought up to present. The Buyers' attorney must prepare a title opinion showing what must be done to give clear title. This can be accomplished in as short a time as five working days and should not take more than two weeks. Closings may take place as quickly as a week from the day the offer to buy was accepted. Thirty to sixty days from date of acceptance of an offer is fairly common. Anything longer than that is usually caused by Buyer or Seller needs for a later possession date. Disclaimer: These answers are in general terms and may vary with specific factual circumstances.

It's a matter of personal preference. Both new and older homes offer distinct advantages, depending upon your unique taste and lifestyle. New homes generally have more space in the rooms where today's families do their living, like a family room or activity area. They're usually easier to maintain, too. However, many homes built years ago offer more total space for the money, as well as larger yards. Taxes on some older homes may also be lower. Some people are charmed by the elegance of an older home but shy away because they're concerned about potential maintenance costs.

Bring your own: Notebook and pen for note-taking Flashlight for seeing enclosed areas Tape measure for checking room sizes, clearance, etc. Be prepared to "snoop around" a little. After all, you want to know as much as possible about the home you buy. Sellers understand that because their home is on the market, it will be looked over pretty thoroughly. If you need to go back to a home for another look, most homeowners will be happy to schedule an appointment. Also, be sure to ask any questions you have about the home, even if you feel you're being nosey. You have a right to know.

Yes. It's not required, but it is very much to your advantage. You'll be able to clearly understand the inspection report, and know exactly which areas need attention. Plus, you can get answers to many questions, tips for maintenance, and a lot of general information that will help you when you move into your new home. Most important, you'll see the home through the eyes of an objective third party.

In addition to the overall inspection, you may wish to have separate tests conducted to check for termites, or the presence of radon gas. Check the phone book for information about these tests, and companies in the area that perform them.

Because the legal contracts and other paperwork involved in buying a home are complex, and can be confusing to the general public, many people prefer to work with an attorney. Your attorney will review contracts, make you aware of special considerations and potential problems, and can accompany you to the closing, to help make everything go as smoothly as possible.

Yes, and the sooner, the better. Most insurance professionals have a lot of experience in working with home owners, and can offer useful tips about home ownership, particularly regarding home safety and keeping your premiums low. Once you've found a home, work together to develop a homeowner's policy that meets your individual insurance needs. You'll need to have the agent you choose to contact your lender as soon as possible for the loan particular's in order to bind your coverage.

In most cases, you'll be given the opportunity to inspect the home immediately prior to closing. This time, it's important to check on any work the seller agreed to have done in response to your initial inspection. You should also carefully check the condition of walls and ceiling from which window treatments, pictures, or any other attached furnishings have been removed. If you find any problems, don't hesitate to bring them up at the closing. It's the seller's responsibility to correct them.

The first thing you'll want to do is have the locks changed. Also, put your deed and other important paperwork from the closing in a secure place, preferably a safe deposit box. Even though it's all on file with the county, it's smart to know where your copies are and have access to them at all times. If you are living in the home, go the County Appraisal District and file for the "homestead" tax exemption. If you are over 65 years old, disabled, or a disabled vet, be sure and ask about filing for these tax exemptions also.

In almost every case, you can save yourself time and energy by using a reputable moving company to help you move. Ask your agent, friends, and co-workers for recommendations, then get estimates from several companies. Don't choose a mover based on price alone--consider the reputation and professionalism of the company, too. Work closely with the moving company to coordinate your efforts and your move will be achieved with premium efficiency.

Simply put, a mortgage is a loan that a home buyer obtains directly from a lender to purchase real estate. The mortgage is a lien on the property that secures a promissory note (promise to repay the debt) that states the terms of the loan, including the interest rate, and the number of payments. The most popular mortgages available to home buyers today can be divided into two general categories: those which offer fixed interest rates and monthly payments, and those where one or both of those factors are adjustable. Fixed rate/fixed payment loans are more traditional, and remain the most popular home financing method, currently accounting for about two-thirds of all residential mortgages. their advantages are well-known: You always know what your monthly principal and interest payment will be, so your basic housing cost will remain unaffected by interest rate changes until the mortgage is paid off. Mortgages that entail flexible rates and/or payments have grown in popularity in recent years, primarily during periods of high interest rates and/or rapidly rising home prices. Many, including the popular ARMs (Adjustable Rate Mortgages), offer lower-than-market initial interest rates that allow buyers a measure of affordability unavailable in fixed-rate loans. The tradeoff may be higher interest rates and higher monthly payments later on.

Most definitely. there are many laws and government regulations that all lenders must follow to ensure that all applicants are given fair and equal treatment. For example, in 1968, Congress passed the Truth in Lending Law, which requires that lenders provide borrowers with information about a loan's true interest rate. By law, lenders must reveal a loan's annual percentage rate (APR). The law also stipulates that for refinancing and second mortgage loans, the borrower has up to three days after closing to change his or her mind and call the deal off. The lender may not disburse money until the three-day recession period has passed.

The annual percentage rate is a calculated rate of interest for a loan over its projected life. This rate includes the interest, all points (which are considered prepaid interest), mortgage insurance, and other charges associated with making the loan that the lender collects from the borrower. The APR is calculated by a standard formula that all lenders use. This enables the borrower to comparison shop between lenders and/or loan products.

The bulk of your monthly mortgage payment goes toward paying off the principal and interest of your loan. In additional, most lenders require that you pay a sufficient amount to cover your local real estate tax, plus your homeowner's or hazard insurance. This amount is placed in an escrow account, from which your lender then pays your tax and insurance bills as they come due. If you pay less than 20% down on Conventional loans, you will also pay Private Mortgage Insurance in with your payment.

If you can afford it, and are interested in the considerable advantages of having more equity and/or owning your home free and clear at the earliest possible date, the answer in most cases is yes. The FHA, VA, and even some states do not allow lenders to charge penalties for paying mortgages early or refinancing. In fact, many lenders now include space on monthly statements for borrowers to itemize any additional principal payment they wish to include with their regular payment.

When interest rates drop significantly, the homeowner should investigate the financial advantages of refinancing. Essentially, this means taking out a new loan to pay off your existing loan. Refinancing may require paying many of the same fees paid at the original closing, plus origination fees. Most mortgage experts agree that if you can get a rate 2% less than your existing loan, and you plan on staying in your home for at least 18 months, refinancing is a good investment.

Although you won't have the benefit of two incomes on which to qualify for a loan, there's no reason that you can't become a homeowner. Become familiar with the process, pick a good real estate broker, and think about getting pre-qualified for a loan. Also, contact your local government to see if there are any local homebuying programs that could help you. Look in the government pages of your phone directory for your local office of housing and community development or, if you can't find it, contact your mayor's office or your county commissioner's office.