Magnum Opus Financial | Home Buying

home buying 1) Please don't overbuy a home. You will be making a payment on a home for 30 years, whether it's this home or another one, that's a long time. It's better to have to build another room onto the house with all the money you saved from buying a smaller home than to lose your home because you can't make the payment anymore.

2) Interest rates are less important than the payment. Don't let the mortgage broker talk to you about how great the rate is. Bottom line, you can either afford the payment or you can't...so worry about the payment and not the interest rate. If you have so much money you can afford to worry about the interest rate, then buy down your interest rate. If your mortgage broker doesn't know what "buying down the rate" means, find a new mortgage broker.

3) Crawl under everything and into everything. NEVER buy a house without seeing every inch of it. Home inspectors are almost immune to lawsuits, so don't rely on them. If it looks like it may break, then COUNT on it breaking! So, be sure to add up all the things that are broken, $4,000 for plumbing, $5,000 for electrical, $12,000 for the roof to the price of the house. Would you still buy it if they all went wrong next year? Please, know what you're buying and don't turn a blind eye or look the other way. Miracles happen, but they don't need to happen to you just to live in your house. Be prepared to own what you buy, you will not have anyone to sue.

4) Buy what you want. It seems simple, but you'd be surprised how much people hate their home when they have to drive an hour just to get to work. Your commute might seem OK now, but do it a few months and you will feel differently. If you buy a home without air conditioning in December... don't cry yourself to sleep in August when you can't sleep it's so hot. Please, don't talk yourself into something because of the price. If it doesn't have air conditioning, add $5,000 and see if you'd still buy it.

5) Pick a real estate agent and mortgage broker you LOVE. Seriously, these people are critical and if you don't have people you love, then you WILL get disappointed. You only buy your first house once. But if you have a good real estate agent and mortgage broker, you'll buy a rental house a half a dozen times. Remember, the majority of millionaires made their money in real estate...but not because they only own one house. Find people you can really trust, ask them a lot of questions, and talk to their clients.