Buying home

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So you think you’re ready to start your search for a new home? Often buyers begin their search by visiting open houses and that is a very good way to begin the process. But, don't waste time visiting properties that are priced out of your budget. Not only will you spend time looking at a home you can't afford but you'll start feeling there's nothing you like in your price range. Instead, start by looking at properties priced BELOW what you can afford and work your way up the price ladder. You be surprised to find just what you're looking for at a price you can afford.With the tightening of the mortgage market, lenders have become much more careful about the borrower's ability to pay the monthly mortgage. Gone are the days of \"Sure you can afford it - it's only going to go up\" and \"We're happy to lend you the money!. In the reality of today's marketplace, lenders are much more diligent about how they lend and to whom.With this in mind, tip # 1 is: SPEAK WITH A MORTGAGE BROKER OR A REPUTABLE LENDER before staring your search to learn based on your personal financial dynamics, exactly what you can afford. Armed with this information, you'll not waste your time looking at properties you'll never be able to buy.An extremely valuable tool in this regard is Chase Manhattan's \"Passport To Purchase Program\" offered by Otis & Ahearn. Chase will provide you with a pre-approval letter (no commitment to borrow from them is required) and will lock your mortgage rate for 90 days. If the rate you've locked goes down, so does your rate. Tip number #2 is: GET A PRE-APPROVAL LETTER for the amount your lender says you can afford. There's a big difference between a Pre-qualification letter and a Pre-approval letter. Pre-qualification means that you've spoken with a lender and they feel that because you're still breathing and are employed you should have no problem qualifying for a loan. Pre-approval means that you have actually taken the time to apply for a mortgage with a lender and that lender has agreed to lend you a certain amount of money provided specific conditions are met. For example you still have to be alive at the closing, still employed and there can be no significant changes in your credit since you were Pre-approved. There may be more contingencies to the lender giving you the loan but you get the point.Tip #3 is:KNOW WHERE YOU STAND. Knowledge equals power. Knowing how much of a loan you can get, at what rate of interest and what your monthly payments will be and having the Pre-approval arrow in your quiver, you are now in a position to know in what price range you can search for your home. That knowledge helps you and/or your Broker help you find the right property and puts you in the position of being able to tell a Seller \"Yes, I can get the money for this property!\" It also eliminates the frustration of falling in love with a property only to discover there's no way you can get a mortgage to buy it.Tip #4 is:Know what's happening in the price range and neighborhoods in which you have interest. I provide my clients with three year historical sales information in their neighborhoods of choice. This data lets you see what is actually happening, good or bad, in any area of the city, no matter what the press is saying. Let me know if you would like to see a sample report – I call them ZoomsIn© Reports because they zoom in to real estate activity in specific Boston neighborhoods.