Fears & Clark Realty Group -

Buy your first home with Fears & Clark and eliminate the stress.

www.FearsClark.com – Home of the U.S. SBA “Entrepreneur of the Year” – Clay Clark

918-481-2080

Welcome to the buyer help page of Fears & Clark. Being that we work with first-time home buyers weekly, we know that buying your first home can be stressful although it does not have to be. You have decided to purchase a home, or are thinking about buying one. You’ll be joining the ranks of hundreds of families who realize that home ownership offers a number of benefits over renting, including building equity, saving for the future, and creating an environment for your family. When you own your own home, your hard-earned dollars contribute to your mortgage. The equity you earn is yours. Over time, your home will increase in value.

Invest in something in you can keep. Invest in your home.

Invest in something you can keep. Invest in your home.

Buying a home in Tulsa, Oklahoma: Buyer Tips

If you plan to buy a home in Tulsa County we invite you to use our search engine to see all the homes and condos listed for sale in the Tulsa MLS. Our professional Buyer’s Agents are here to help you through the real estate purchase process. Call us at (918) 481-2080 when buying Tulsa real estate.

Home buying is probably the biggest financial commitment you’ll ever make. Buying a home in Tulsa is not just a dollars-and-cents investment; it’s an investment in your life. It’s an investment in the American Dream. It will create a sense of stability and identity for you and your family. Regardless of how times change, owning a home remains the cornerstone of the American dream.

To assist you in the process, Braxton Fears and his team of REALTORS® have everything you need; from a basic step-by-step overview to a property comparison checklist to finding you the best mortgage option possible. So whether you’re a first time home buyer or need a brief real estate buying refresher, let us help you through it.

Use our MLS Wizard to search ALL Tulsa homes listed for sale. When you sign in to your FREE VIP Membership you get access to Virtual Tours, Addresses, Multiple Photos, 24-Hour Property Updates & More!

Tulsa Home Neighborhood Evaluation

The most important factor to consider when buying a home in Tulsa is location! location! location! Here are some tips to evaluate neighborhoods before you buy.

Should you rent or buy a home? Here you can see and compare the advantages of buying a home versus renting.

Below is a list of the various services offered to home buyers by the Fears & Clark Realty Group Team:

How Much Home Can I Afford?

A quick look at your finances and what mortgage payments you can afford, the benefits of home equity, what tax advantages you have as a home owner, and what the are steps for getting pre-qualified and approved for your home loan.

Working With A REALTOR®

Why buying a home with a real estate agent makes sense and how to choose a real estate buyer’s agent who is right for you.

Tulsa Short Sales

I am getting a good deal by buying a short sale home. Fact or myth?

Making An Offer

What you should know about making an offer on a potential property.

Home Inspections

Having your new home inspected prior to finalizing your purchase agreement is a great idea. And don’t forget to buy homeowner’s insurance to protect yourself against any unforeseen disasters!

Title Insurance & Escrow

Understanding title insurance and the closing process through escrow will help you make better home buying decisions.

Tulsa Property Tax

Tulsa County Property Taxes and Supplemental Property Tax Guide

Give us a call today at (918) 481-2080… We can answer your questions!

Rent or Buy?

Find Your Home

The Steps to Buying a Home in Tulsa, OK…

…Enjoy the journey that will put you into your new home.

It is exciting to know that one of the houses you look at today will be your home tomorrow!

No one buys a fireplace, a deck or a 2 car garage. They buy love, security, privacy, and romance. Think about why you want to buy and imagine yourself in your new home.

Until you are ready to buy; search ads, drive by, and visit open houses and keep track of the sale prices in areas that interest you.

The journey will be both exciting and stressful.

The purchase of a home may be the largest purchase you will ever make. Don’t let anyone “talk you into” a property that doesn’t feel right to you. The home sells itself as it speaks to its new owner.

You will know that you are home when you walk in. Let your discernment decide. Don’t buy specifications. Shop for your goals of comfort, independence, security, building equity, self fulfillment, pride, convenience, and the feelings of comfort and love. Get in touch with why you want to buy before you try to decide what you want to buy.

STEPS TO TAKE BEFORE BUYING YOUR FIRST HOME

From Scripps Howard News Service

When buying a house, many people discover they can’t afford as much as they had hoped and past financial sins come back to haunt them. If you’re among those considering a housing purchase this year, here are some points to consider from the Fannie Mae buying guide, “Opening the Door to a Home of Your Own”;

* If you haven’t been working steadily for at least two years, you may have trouble getting a mortgage unless there’s a reasonable explanation, such as recently finishing school or military service or seasonal work that leaves a gap in your record. “If you have been fired for cause such as excessive absences, have long gaps in your employment record or have dips in your income level that are difficult to explain, you should probably delay buying a home,” Fannie Mae says.

* Lenders are wary of people who don’t pay their bills on time. Your record is right there for all to see on national credit reports. Before you set out to buy a house, clean up your credit record, that is, establish a two-year record of paying bills on time. You can get a copy of your credit report from the three national credit reporting services, The fee is generally $10-20, but call the toll-free 800 numbers for details. They are Equifax, (800) 685-1111; Experian, (800) 682-7654; and Trans Union (800) 916-8800.

* For most mortgages, you’ll need a down payment of at least 5% of the purchase price. On a $120,000 mortgage, that would be $6,000. You also may need several thousand dollars more for closing costs.

* Before you start house hunting, figure out how much you can afford to pay. As a rule of thumb, count on spending no more than 28% of your gross (before taxes) monthly income on housing expenses-principal, interest, insurance and property taxes. All your monthly debts should come to no more than 36% of your gross income.

DETERMINE WHEN YOU WANT TO BE IN YOUR NEW HOME

If you buy today, you will probably close in 30-45 days from today. Does this time line fit your projected moving plans?

FIND OUT HOW MUCH YOU SHOULD INVEST IN YOUR PURCHASE

Arrange a counseling session with a competent REALTOR® or a prequalification appointment with a lender.

TO CHOOSE A LENDER, ask a real estate professional for referrals. The experienced REALTOR® will have the names of lenders who have proven themselves regarding service and commitment.

WHAT WOULD YOU LIKE TO BUY?

A. LOCATION, LOCATION, LOCATION.

The three most important elements of your purchase. You can usually change anything except location. Consider geographic and social aspects of location.

B. SIZE

Consider the size. If its smaller than you had hoped for, can you deal with the size or can it be expanded within your budget?

C. STRUCTURE

Is it sound? Does it need repairs that you can handle? Are the necessary repairs and upgrades within your budget? Will the necessary changes be good investments in the event you have to sell later?

D. AMENITIES

Does the property have all of the amenities you want? If missing, are they important? If important and missing, can you fix it?

WORKING WITH A REALTOR®

Did you know?

Very few homes sell through Open Houses. 1 in 400 homes sell through classified ads. Only half of the homes for sale are in the ads and Open Houses.

If you are serious about buying a property, it makes sense to work with a professional. The professional can make it easier. The first meeting is important. It is your opportunity to interview and get acquainted with the REALTOR® as well as help the professional understand your reasons for buying and the factors that are important to you. Be sure to stay candid about which factors are motivating you the most in your home purchase.

WHAT SHOULD YOU EXPECT FROM THE REALTOR®?

1. The REALTOR® will review the properties available and select those that meet your criteria.

2. The Multiple Listing Service will provide access to most homes on the market.

3. The REALTOR® will arrange the showings.

4. The REALTOR® will provide property and finance information.

5. The professional will provide, upon request, enough information that will help you estimate property values.

6. The REALTOR® will prepare your sales contract.

7. The REALTOR® will arrange for the presentation and negotiation with the seller.

8. The REALTOR® will assist you with financing.

9. The REALTOR® will help you arrange inspections.

10.The REALTOR® will insure all government forms & seller disclosures are provided

11. The REALTOR® will follow through and help take you through the closing.

HOW MANY REALTORS® SHOULD YOU WORK WITH?

REALTORS® work on commission. The best REALTORS® will only commit to you if you commit to working with them. The best REALTORS® will “back-off” if you are working with others. One good REALTOR® will benefit you by reciprocal loyalty. You will get better service if the REALTOR® knows your loyalty.

HOUSE HUNTING WITH CHILDREN

From the Orlando Sentinel

* Take special care to talk to your children about the upcoming move. Deal with their concerns as they come up.

* Leave young children with friends, family or a baby sitter during the initial house hunt. House hunting is stressful enough and details of individual houses tend to blur after tours through several. Fidgety children can complicate matters. Going alone will also eliminate the potential embarrassment of having to ask the seller for bathroom privileges for your youngster.

* Include your older children in the house-shopping process as much as possible. Keep them occupied by letting them plan and pack a box or two of their special things. Seek their input on new décor and room design, and what kinds of features they would like to see in a new house and in the neighborhood. Make sure you inform your children that just because they would like an indoor Laser Tag arena that you may not be able to make good on such a request.

* Investigate the community and locate things such as recreation centers, churches, movie theaters, etc.

* Once you have selected your dream home, if possible, bring your children along for a tour of the house and neighborhood. If this is not possible, take plenty of pictures of your new place, fun local areas, and schools to share with your kids.

SOME “INSIDER” SECRETS TO GETTING WHAT YOU WANT

1. GET PRE-APPROVED.

To make the strongest offer possible get “pre-approval.” The process takes a few days to a few weeks. With your pre-approval certificate, it’s like taking cash to the seller. If you are competing against other offers you will have a definite advantage.

2. DAILY SEARCH

When you are serious about buying, find a REALTOR® who is serious about helping you. Get your agent to do daily MLS searches.

3. SPEED IS IMPORTANT

Don’t think you can look tomorrow or just on weekends. Look immediately and be prepared to make your offer on the spot.

4. WRITE A “GOOD” OFFER.

Write your offer to be accepted; not countered. While you are in-counter, someone else could be buying your home. Negotiation is only important to you when you get what you want.

5. THE PRICE

Asking price used to be what the seller hoped for. In a “hot” market, there may be multiple offers. The actual sale price can be more than asking. If you have done your homework before-hand, you will feel more secure when negotiating your offer.

6. BEST OFFER

If you are the only offer when you write, other offers may come in after you have written. Even if you end up in a multiple offer scenario, the seller may choose your offer, because you started better than the rest. It’s not scientific, but it can work!

7. THE BIG PICTURE

If you get what you want, you are the winner. The couple thousand dollars you might save could cost you what you really want. When you move in-you’ll look back and congratulate yourself.

NOW, LET’S WRITE AN OFFER

Remember: Once you choose a property, everyone else in the world will want it too.

* Write your best offer. (Across U.S. & Canada, the average property sells within 97% of asking.)

* The offer should be drafted carefully. Some guidelines are:

-WRITE YOUR BEST OFFER- Anytime you initially low-ball you risk losing the property to another buyer.

-EARNEST MONEY- The more earnest money you offer, the more confidence the seller will have in your commitment to the transaction.

-INCLUSIONS If- you want an item included, it must be stated in the offer. Whether or not it is shown on an MLS print-out, it isn’t included unless it’s stated in the offer.

-TIME IS OF THE ESSENCE- This means that the dates are extremely important. Planning to work the next day isn’t good enough! Midnight on the day named is the “drop dead” deadline. (Watch especially for loan commitment deadlines.)

- OCCUPANCY AFTER CLOSING -It is a good idea to offer the seller at least a few days after closing to get packed up and moved. This avoids forcing them to be “on the truck” at the closing. The seller usually prefers to have money-in-hand before they move their large items.

-INSPECTION - Inspecting your future home through a professional inspection PRIOR to the transfer of title is an incredibly wise investment!

-ADDENDUMS – Many companies use their own. Items are covered that may not be addressed in the offer, i.e. Asbestos, Lead, Lead Based Paint, Radon, Safe Water, Well and Septic Inspections, Home Warranties, Code Compliance, Surveys or Boundary Maps, etc.

*Whether the seller or the buyer is dealing with the offer, the choices are the same: “Accept”, “Reject”, “Counter”.

*Upon an accepted offer, upwards of 30 people are part of the transaction. There are lenders, loan officers, appraisers, credit checkers, inspectors, processors, and more.

*If you work with a REALTOR®, follow the steps, do your homework and provide the information needed by the lender, you will be comfortable with your decision and should live “happily ever after!”

EXTRA NOTE:

It is important that you don’t make major life changes between the time you make an offer and the closing.

Job Change:

Don’t make job changes without the blessings of your lender – before the fact. A “new job” could kill your transaction, affecting the “time on the job” criteria.

Marital Status:

A divorce can reduce your income. A marriage can change the loan application. If your new spouse has past credit problems, you will likely have a problem with credit scoring requirements. As with a contemplated job change, make no marriage plans without your lenders blessings. Poor timing could jeopardize your transaction.

Major Purchases:

Buying a car or other major item on credit can significantly change your debt ratios. Again, no major changes while you’re buying a home.

Where can I get information on local housing market stats?

A REALTOR® is a good source for finding out the condition of the local housing market. A REALTOR® is in the business of knowing what is happening in the local market and can provide competent advice to Sellers and Buyers.

How is a home’s value determined?

There are several ways to determine the value of a home:

* An appraisal is a professional estimate of a property’s market value, based on recent sales of comparable properties, location, square footage and construction quality. This service varies in cost depending on the price of the home.
* A comparative market analysis is an informal estimate of market value performed by a REALTOR® based on similar sales and property attributes. The REALTOR® will most often compare those homes currently for sale, those that have recently gone under contract and those that have sold in the past 6 months in order to estimate value. Most agents offer a free analysis in the hopes of winning your business.
What is the difference between market value and appraised value?

Appraised value is a certified appraiser’s opinion of the worth of a home at a given point in time. Lenders require appraisals as part of the loan application process; fees range from $200 and up.

Market value is what price the house will bring at a given point in time. A comparative market analysis is an informal estimate of market value, based on sales of comparable properties, performed by a REALTOR® or broker.

What is Assessed Value?

The assessed value of a home is determined by the City or County Assessor. The Assessor is responsible for assigning values to all taxable property within a city’s limits. This involves an on-going process of gathering and reviewing information, measuring and listing new construction, and investigating sales of real estate to provide accurate and current values.

The City Assessor also processes applications for homestead credits, veterans’ exemptions, industrial property tax abatements, urban revitalization exemptions, and various other programs. The City Assessor’s office provides a significant amount of information regarding property values, selling prices, ownership, and physical characteristics to the public and other city and county departments.

What standards do appraisers use to estimate value?

Appraisers use several factors when estimating value including historical records, property performance, condition of the home and indices that forecast future value.

How do property taxes work?

Property taxes are what most homeowners in the United States pay for the privilege of owning a piece of real estate in particular city or county. A typical property tax averages 1.5 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.

Are property taxes deductible?

Property taxes on all real estate, including those levied by state and local governments and school districts are usually fully deductible against income taxes. Check with your tax professional for local laws and allowances.

What is an escrow account?

An escrow account is a trust account established by the lender to hold money to pay for real estate taxes as well as mortgage and homeowners insurance premiums as they are received each month.

Do all loans require escrow accounts?

If you are taking out an FHA or VA loan, the lender may require an escrow account to pay real estate taxes and hazard insurance premiums. Most conventional loans do not require an escrow account.

Who gets the furnishings when a home is sold?

Fixtures, any kind of personal property that is permanently attached to a house (such as drapery rods, built-in bookcases, tacked-down carpeting or a furnace), automatically stay with the house unless specified otherwise in the sales contract. But you can consider anything that is not nailed down negotiable. This most often involves appliances that are not built in (washer, dryer, refrigerator, for example), although some sellers are interested in negotiating for other items, such as a piano.

What is the difference between list price, sales price and appraised value?

The list price is a seller’s advertised price, a figure that usually is only a rough estimate of what the seller wants to get. Sellers can price high, low or close to what they hope to get. To judge whether the list price is a fair one, be sure to consult comparable sales prices in the area.

The sales price is the amount of money you as a buyer agree with a willing seller to pay for a property.

The appraisal value is a certified appraiser’s estimate of the worth of a property, and is based on comparable sales, the condition of the market and numerous other factors.

How do you choose between buying and renting?

Home ownership offers tax benefits as well as the freedom to make decisions about your home. An advantage of renting is not worrying about maintenance and other financial obligations associated with owning property.

There also are a number of economic considerations. Unlike renters, home owners who secure a fixed-rate loan can lock in their monthly housing costs and make prudent investment plans knowing these expenses will not increase substantially.

Home ownership is a highly leveraged investment that can yield substantial profit on a nominal front-end investment. However, such returns depend on home-price appreciation.

What do all of those real estate acronyms in the ads mean?
* ACR – acreage
* BR – bedrooms
* BA – bathrooms
* Gar – garage (garden is usually abbreviated “gard”)
* DR – Dining room
* LR – Living Room
* GR – Great Room
* KIT – Ktichen
* FP, frplc, fplc – fireplace
* Grmt kit — gourmet kitchen
Is a low offer a good idea?

While your low offer in a normal market might be rejected immediately, in a buyer’s market a motivated seller will either accept or make a counteroffer.

Full-price offers or above are more likely to be accepted by the seller. But there are other considerations involved:

* Is the offer contingent upon anything, such as the sale of the buyer’s current house? If so, a low offer, even a full price offer, may not be as attractive as an offer without that condition.
* Is the offer made on the house as is, or does the buyer want the seller to make some repairs or lower the price instead?
* Is the offer all cash, meaning the buyer has waived the financing contingency? If so, then an offer at less than the asking price may be more attractive to the seller than a full-price offer with a financing contingency.
What contingencies should be put in an offer?

Most offers include two standard contingencies: a financing contingency, which makes the sale dependent on the buyers’ ability to obtain a loan commitment from a lender, and an inspection contingency, which allows buyers to have professionals inspect the property to their satisfaction.

A buyer could forfeit his or her deposit under certain circumstances, such as backing out of the deal for a reason not stipulated in the contract.

The purchase contract must include the seller’s responsibilities, such things as passing clear title, maintaining the property in its present condition until closing and making any agreed-upon repairs to the property.

What are some tips on negotiation?
* The more you know about a seller’s motivation, the stronger a negotiating position you are in. For example, a seller who must move quickly due to a job transfer may be more open to a lower price. Other so-called “motivated sellers” include people going through a divorce or those who have already purchased another home.
* Remember, that the listing price is what the seller would like to receive but is not necessarily what they will settle for. Before making an offer, check the recent sales prices of comparable homes in the neighborhood to see how the seller’s asking price stacks up.
* Some experts discourage making deliberate low-ball offers. While such an offer can be presented, it can also sour the sale and discourage the seller from negotiating at all.
What home-buying costs are deductible?

Any points you or the seller pay for your home loan are deductible for that year. Property taxes and interest are deductible every year.

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, loan-application fee, credit report, appraisal fee, service fee, settlement or closing fees, bank attorney’s fee, attorney’s fee, document preparation fee and recording fees.

Explain the home mortgage deduction?

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 pay off your loan early.

Why buy a house?

Here are some frequently cited reasons for buying a house:

* You need a tax break. The mortgage interest deduction can make home ownership very appealing.
* You are not counting on price appreciation in the short term.
* You can afford the monthly payments.
* You plan to stay in the house long enough for the appreciation to cover your transaction costs. The costs of buying and selling a home include real estate commissions, lender fees and closing costs that can amount to more than 10 percent of the sales price.
* You prefer to be an owner rather than a renter.
* You can handle the maintenance expenses and headaches.
What is the best time to buy?

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 traditionally been slow months, although some astute buyers look for bargains during this period.

What is the first step to buying a home?

Finding out what you can afford is one of the first steps, which can be done by pre-qualifying for a home loan. This step will help you narrow your search for both a neighborhood and particular houses. A pre-qualification is a simple calculation that considers several factors, but primarily your income. There are no guarantees with a lender pre-qualification notice, but it will be expected of you when you make an offer on a home.

Should I include an inspection contingency in my offer?

An “inspection contingency” protects you as a buyer in a purchase offer by allowing you to cancel closing on the deal if an inspector finds problems with the property.

As soon as the seller accepts a written offer, the document becomes a legally binding contract. The purchase contract can be written to include a contingency for any repairs found to be needed or related items the seller must take care of before closing. If these are not dealt with, and you have such a clause in your contract, you can delay or possibly cancel the closing. If it’s not stated in the contract, you could face losing your deposit. There also may be costly legal implications stemming from backing out of a contract.

You usually will have the right to choose the inspector (and be responsible for paying for the inspections). In addition to an overall inspection for structural soundness, you can request a satisfactory pest control inspection report, roof inspection report or contingency for no potential environmental hazards such as asbestos or radon gas.

Contingency clauses should satisfy the concerns of both the buyer and seller. Buyers also can protect themselves by inserting additional necessary contingencies. Indicate which items like curtains and appliances are to remain with the house. Then stipulate that you have the right to personally inspect the home 24 hours before closing to make sure all is in order.

What’s a home inspection?

A home inspection is when a paid professional inspector, someone who has been trained and is certified, inspects the home, searching for defects or other problems that might plague the owner later on. They usually represent the buyer and or are paid by the buyer. The inspection usually takes place after a purchase contract between buyer and seller has been signed.

Do I need a home inspection?

Yes. Buying a home “as is” is a risky concept. Major repairs on homes can amount to thousands of dollars. Plumbing, electrical and roof problems represent significant and complex systems that are costly to fix.

How do I find a home inspector?

Your REALTOR® is one source. Inspectors are listed in the yellow pages. You can ask for referrals from friends. Ask for their credentials: are they bonded; do they carry Errors & Omissions insurance; are they ASHI certified; are they certified to test for radon and mold. The cost of a Home Inspection varies from community to community and also on the size of the home.

Fears & Clark Realtors have a list of Home Inspectors which show those who are bonded, carry Errors & Omissions insurance, ASHI Certification, Certification for Radon testing and their approximate costs. Contact any Fears & Clark Realtor for this list.

What is a Pre-List Inspection?

A Pre-List Inspection is done on the behalf of the Seller before the home is listed. A Pre-List inspection uncovers any potential problems that might come up after a contract is signed between a Buyer and Seller. Having the inspection done before the home is listed allows the buyer to address and potential problems before the home is ever put on the market for sale.

What repairs should the seller make?

Most sellers like to make all minor repairs before going on the market in order to seek a higher sales price. In addition, nearly all purchase contracts include a buyer contingency “inspection clause,” which allows a buyer to back out if numerous defects are found. Once the problems are noted, buyers can attempt to negotiate repairs or a lower price.

How much house can I afford?

Knowing what you can afford is the first rule of home buying, and that depends on how much income and how much debt you have. In general, lenders don’t want borrowers to spend more than 28 percent of their gross income per month on a mortgage payment or more than 36 percent on debts.

It pays to check with several lenders before you start searching for a home. Most will be happy to roughly calculate what you can afford and prequalify you for a loan.

The price you can afford to pay for a home will depend on six factors:

1. gross income
2. the available cash you have for a down payment, closing costs, and reserves required by the lender
3. your outstanding debts
4. your credit history
5. the type of mortgage you select
6. current interest rates
Another factor lenders use to evaluate how much you can afford is your housing expense-to-income ratio. It is determined by calculating your projected monthly housing expense, which consists of the principal and interest payment on your new home loan, property taxes and hazard insurance (or PITI as it is known). If you have to pay monthly homeowners association dues and/or private mortgage insurance, this also will be added to your PITI.

This ratio should fall between 28 to 33 percent, although some lenders will go higher under certain circumstances. Your total debt-to-income ratio should be in the 34 to 38 percent range.

What is the standard debt-to-income ratio?

A standard ratio used by lenders limits the mortgage payment to 28 percent of the borrower’s gross income and the mortgage payment, combined with all other debts, to 36 percent of the total.

The fact that some loan applicants are accustomed to spending 40 percent of their monthly income on rent — and still promptly make the payment each time — has prompted some lenders to broaden their acceptable mortgage payment amount when considering a percentage of the applicant’s income.

Other real estate experts tell borrowers facing rejection to compensate for negative factors by saving up for a larger down payment. Mortgage loans, requiring little or no outside documentation, often can be obtained with down payments of 25 percent or more of the purchase price.

What are closing costs?

Closing costs are fees paid for services, taxes or special interest charges, that surround the purchase of a home. These include upfront loan points, title insurance, escrow or closing day charges, document fees, prepaid interest and property taxes. Unless these charges are rolled into the loan, they must be paid when the home is closed.

Who pays the closing costs?

Closing costs are either paid by the home seller or home buyer. It often depends on local custom and what the buyer and seller negotiate.

Can you negotiate the price on new homes?

It can be difficult to negotiate the sales price with a Builder because they may claim their prices are based on fixed construction costs. But it doesn’t hurt to try.

If negotiating the price doesn’t work, buyers commonly negotiate for better amenities (upgrade carpet, light fixtures, etc.) Experts say a builder will rarely pass up a deal over a couple hundred dollars’ worth of carpeting, for example.

What are some new-home cautions?

When you buy a resale home, you can find out a lot more about the property and the neighborhood before you buy, than when you buy a new home.

Land to support new home developments is usually located on the outskirts of town. Potential buyers should ask the developer about future access to public transit, entertainment activities, shopping centers, churches and schools. Find out how far it is to the nearest library, for example.

Every subdivision should have Restrictive Covenants. Be sure to ask to see these before deciding on a purchase. Restrictive covenants may include any/ all of the following: size of the house, shingle color and type, fencing, satellite dishes, and more.

Local zoning ordinances also should be reviewed. A rather remote area can turn into a fast-food-chain haven within a couple of years. Try to ensure that the neighborhood, if not strictly residential, will not begin sprawling out of control.

What are considerations to buying a new home?

Builders may have a target market in mind for their new-home projects. Some may tout communities as glamorous to upscale urban professionals seeking amenities such as a golf course, hot tubs and tennis courts. While a playground and swimming pool might be essential to a project geared toward families, senior citizens will be more attracted to walking trails and an easy-to-care-for yard.

Do not be tempted to move into a “glamorous” community where you might be able to afford the house but not the lifestyle. In addition, similar-looking new houses often come complete with restrictions imposed by the developer on house color, landscaping, renovations and anything else a homeowner could possibly want to do to differentiate their house from the common appearance.

Marketing experts try to appeal to buyer’s tastes by their promoting images for their developments. Don’t buy into it. Form your own opinions and buy a home where you feel comfortable. After all, you’re going to have to live there.

Listed below are various links to additional sites that have more information about government first-time home buyer tax credits: