Do I need a real estate agent to buy a house?

With all of the information available on sites like Trulia, Zillow, etc.  It may seem like you don’t even need a real estate agent.  You can see every house without walking in.

So what do you need a real estate agent for?

What you need is a real estate professional that will help make the buying experience easier for you.  One who can help you from the vey start to determine if now is the right time to buy (check out my post on renting vs. buying) and help you determine  how much you can afford to spend on a home.   You can then use these to help determine a budget and start your search at my website.

Mel Foster Co. is a leader in providing the tools that make the home buying experience easier and one great tool that we have available is our property watch.  Sign up for property watch and you can be the first to know about all “Just Listed” properties in your target area.  As your real estate professional, I can help you focus in on what you need and what you are looking for.  My experience in local markets will also help you to know how quickly you need to make a decision once you find a home you like.  In some markets, property moves slowly and in others, property is hardly listed a few days before an offer is made and accepted.

When you do find a home that you would like to purchase, I can help you determine the likely sales price, help you to write the offer an to negotiate on your behalf.  I think this is the area that many people see as the biggest benefit of using a real estate agent.  Certain things that home buyers may be unaware of (like orangeburg tile in parts of Davenport, or high radon levels in the area) are part of our daily dealings and it is important to know what you can test for prior to purchasing the property.  Certainly having a third party negotiate on your behalf is a huge benefit.  It removes the emotion and allows you time to think about what you actually want to do.  I will also act as your advocate to protect you during financing, negotiations, inspections, contingencies and possession.

Since this is what I do everyday, I also have an extensive network of mortgage lenders, home inspectors, lawyers, home repair specialists, movers, and almost anything related to home ownership!

The true benefit of signing on with a real estate professional early on in your search is that you can save tons of time.  You don’t have to wait for open houses to view a home. I can show you any house on the market at a time that is convenient for you.  This includes MelFoster listings, other companies listings, and even For Sale By Owners!

Some people hesitate to use a realtor to buy a house because they think they have to pay their commission, however my commission is paid for and pre-negotiated with the seller.

If you have any questions about what it would be like to work with a real estate professional like me, call or text me at 563.249.9170 or you can email me at charlotte@melfosterco.com.

Happy House Hunting!

Should I Rent or Buy?

The age old question… Can I afford to buy a house or should I continue to rent?

So start off with the basic information you need.
•How much do you currently pay in rent?
•How much house can I afford?
•What kind of interest rate can I get on a Mortgage?
•How long would I live in this house?

The first one should be easy. The second one can be tricky. If you don’t know how much house you can afford, you can read my post here. It will help you to get a ball park idea of what you can afford. If you don’t like crunching numbers, shoot me a text or email and I will put you in contact with a good mortgage lender who will do the job in a few minutes over the phone!

The last question is going to be different for everyone. It depends on what stage of life you are, whether you will get relocated for work and a million other things, so you kind of have to make an educated guess for yourself. The National Association of Builders found that the average first time homeowner lives in their home for 13 years. Non first time homeowners were found to live in their home for an average of 16 years.

Here is a simple calculator from Trulia that you can use to compare the cost of renting versus buying.

When you figure out your target home price, you can look for homes in your target area and price range on my website.

Call/Text me at 563.249.9170 or email me at charlotte@melfosterco.com if you have any questions!

How Much House Can I Afford?

A few things you need to know to figure out home much house you can afford:

  • How much money do I make a year?
  • How much money do I pay on credit cards, auto loans, student loans, child support, etc. each month?
  • What is my credit score?
  • How much money have I saved up for a down payment?

These are the basic numbers that you need to know to start to figure out how much home you can afford.

A general rule of thumb is that you can afford a home three times your annual income.  So if you make $60,000/year you could afford a $180,000 home.  Of course each case is different and it is best to speak with your local mortgage lender first.  Call or text me if you want me to refer you to a good one!

When the mortgage company goes to determine the amount of money they will loan you, the will look at two very important numbers.

  1. Your mortgage (Principal and Interest), taxes and insurance should be less than 28% of your annual income.  In this case, your monthly income would be $5,000, thus 28% would be $1,400.  Average annual taxes are $3,500 and annual insurance is about $500.  To be safe, lets assume this breaks down to about $350/month.  So the maximum mortgage you could pay every month would be $1,050.
  2. Principal, Interest, Tax and Insurance (the total amount calculated above) plus any monthly credit card payments, car loan payments, child support payments, student loan payments or anything else that would show up on your credit report should be less than 36% of your annual income.  In this case, your monthly maximum would be $1,800.

Your credit score (which is likely better than you expect) and the amount of money you have available for a down payment is important, because it influences the interest rate you will get.

This calculator from CNN will help you figure out how much house you can afford.

When you figure out how much house you can afford check out what is available in your local area on my website.  Happy House Hunting!

Call/Text me at 563.249.9170 or email me at charlotte@melfosterco.com with any questions.