Tips for Navigating the Housing Market

Studies on homeownership prove that it enhances our lives in many ways, and among them is how we plant deeper stakes within the communities we call home. Since navigating the housing market has become more complex than ever, any potential homebuyer, whether a first-time buyer or not, can benefit from solid professional advice in their pursuit of homeownership.

To that end, the Metropolitan Regional Information Systems (MRIS) has compiled the following list of "must read" tips from among its 45,000+ network of real estate professionals, reinforcing some of the best practices for ensuring that potential homebuyers are home-ready.



* Understand and update your FICO credit score. This single number plays a major role in determining the interest rate on your mortgage, so it's vital to know what your FICO score is, address any discrepancies and take corrective action to improve your score if it's below par. As of May 2012, 664 was listed as the national average, and the median was listed as 723. Individuals with scores of at least 700 tend to get the best rates on a mortgage. Remember that each of the nationwide consumer reporting companies--Equifax, Experian and TransUnion--are required to provide you with a free copy of your credit report, at your request, once per year.



* Know what you can afford. Up to 12 months in advance of your desired home purchase, establish a relationship with a trusted mortgage lender who can help you identify your monthly payment goals, target purchase price and the types of loans you are qualified for based on your current financial situation.



* Boost your savings. After you have determined your monthly payment goals and target purchase price, make sure you have the cash on hand for when you are ready to buy. We suggest saving enough money for six months of mortgage payments, as well as a minimum of 3.5 percent of the purchase price to cover the down payment and closing costs. First-time and repeat homebuyers should also establish reserves for less visible expenses, such as closing costs, moving costs, home repairs, renovations and planned upgrades when saving for a home.



* Avoid making major purchases. When preparing to buy a home, it's important to stay away from big-ticket items, such as purchasing a car, in order to keep your cash reserves high and show the lender that you'll be able to service the mortgage debt more easily.



* Understand the micro-local real estate market. Homebuyers can save themselves money by watching the seasonal trends in their targeted area(s) and being financially prepared to make an offer when the time is right.



* Consult a real estate professional. Long before you are ready to buy, seek out and interview a real estate professional and preferably one who holds a real estate broker's license who can then prepare you to face the market by addressing questions, setting realistic expectations, and providing valuable insight and expertise to the complex process of home purchasing.



Please know that I am always willing to offer my professional services and expertise to you, your family, your friends, and any acquaintances. Do not ever hesitate to contact me should you have a question I can address.