Tips for buying in the Hamptons ...

Here are some basic tips for buying a home..

The Basic Tips
Why Buying a Home is a Good Idea
Things Not to Do Before Purchasing a Home
Top 5 First Time Home Buyer Mistakes

Basic Tips:

With inventory diminishing daily and multiple offers being extremely common, it is of great importance that you position yourself to have the "Best Chance" to get your offer accepted. You enhance your chance of getting the home of your choice by doing the following:

Get pre-approved for the purchase:
This takes very little time and is of great value. At this time, identify the price range for which you qualify and which fits your lifestyle.  

Submit a strong competitive offer:
Submit the offer as if there will be multiple offers. As part of your offer, you will need to disclose the size of your down payment. This allows the seller to evaluate your likelihood of obtaining a home loan.

Include substantial earnest money deposit:
Acceptance of an offer is sometimes determined by the amount of the deposit. A larger amount may signify a bigger commitment to the seller.

Minimize or eliminate contingencies:
The fewer contingencies, the stronger the offer.

Be Prepared to Preview a new property quickly:
Homes sell sometimes in hours. Be prepared to make decisions quickly and be accessible to change the terms instantly.

Buyer and agent to have instant communication access:
Let us maintain instant access to each other via office phone, voice mail, email, fax, or cellular phone.

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Why Buying a Home is a Good Idea:

Income Tax Savings:
Because of income tax deductions, the government is subsidizing your purchase of a home. All of the interest and property taxes you pay in a given year may be deducted from your gross income to reduce your taxable income.

Easily Stabilize Your Monthly Housing Costs:
Acquiring a fixed rate mortgage when you buy a home can give you the same monthly payment amount for the duration of the mortgage. Even an adjustable rate mortgage payment will stay within a certain range for the entire life of the mortgage.

Forced Savings & Best Investment
You accumulate savings in two ways. Every month, a portion of your payment goes towards the principal. Admittedly, in the early years of the mortgage, this is not much. Over time, however, it accelerates. Second, your home appreciates. Over time, history has shown that owning a home is one of the very best financial investments. Your rate of return when buying a home is higher than most any other investment you could make.

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Things Not to Do Before Purchasing a Home:

No Major Purchases of Any Kind
No major purchases that would create debt of any kind. This includes furniture, appliances, electronic equipment, jewelry, vacations, expensive weddings or automobiles.

Do Not Move Money Around.
When a lender reviews your loan package for approval, one of the things they are concerned about is the source of funds for your down payment and closing costs. Most likely, you will be asked to provide statements for the last two or three months on any of your liquid assets. This includes checking accounts, savings accounts, money market funds, certificates of deposit, stock statements, mutual funds, and even your company 401K and retirement accounts.

If you have been moving money between accounts during that time, there may be large deposits and withdrawals in some of them.

The mortgage underwriter will probably require a complete paper trail of all the withdrawals and deposits. You may be required to produce canceled checks, deposit receipts, and other seemingly inconsequential data, which could get quite tedious. Moving your money around, even if you are consolidating your funds to make it "easier", could make it more difficult for the lender to properly document.

So leave your money where it is until you talk to your loan officer. Don't change banks, either.

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Top 5 First Time Home Buyer Mistakes

1. Buying a home you cannot afford. Get pre-approved by a mortgage broker and find out how much you can qualify for and what price range you should be looking in. Do not go overboard. Choose a monthly loan payment within your budget.

2. Deciding to Rent vs. Own home. Stop paying your landlord. Home prices and interest rates are rising and you could be losing thousands of dollars in tax deductions and equity.

3. Buying the wrong size home. Check out floor plans for space and functionability. Plan for changes in lifestyle such as marriage and children. Think ahead.

4. Passing on a good home because it isn't perfect. Make a wish list of features and prioritize which ones are really important to you such as a neighborhood, parking space, room size, etc.. Be specific about what you want and really need.

5. Choosing the wrong mortgage. There are 0-5% down payment options and you may not want a 30 Year Fixed Mortgage if you will be living in the home 7 years or less. A 5 year ARM may suit your financial needs and save you money.

SELL or BUY your home with a Resort and Second Home Property Specialist.

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Contact Clare today to get ahead of the pack. As a 10 year resident of the Hamptons, I know just where to be.

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