Owning a home is an investment in your future. My parents bought their first home when they were married as teenagers. Jace bought his first home fresh out of college. I bought my first home just before my first baby was born. My daughter bought her first home when she launched her career. Melissa bought her first home because she was tired of paying rent. Every home has a story, and so does every homeowner.

Today’s first-time home buyer has three questions, actually they have three-thousand questions but most of them are answered with these three:

1) How much will it cost? (More than my rent or less than my rent)

2) Can I afford it? (I don’t want to go through a foreclosure someday)

3) How do I know which house to buy? (I’ve already made enough mistakes in my life!)

Today’s first-time home buyer also has a few fears to conquer:

1) Who is going to lend me the money? (You’ll have a surprising number of lenders to choose from)

2) What if my credit isn’t perfect? (That’s OK, we’ll work to improve it)

3) Can I buy a house if I’m single? Married? Have kids? Just got a new job? Am self-employed? What if I just got divorced? (Yes times seven)

And then there’s that whole foreign language thing – as soon as you start thinking about buying a house people start tossing out words like depreciation, amortized, escrow, earnest money, appraisal, and other real estate terms that make you say “Huh?”.

If you’re thinking of buying a house in Sequim, Port Angeles, Forks, Joyce, Carlsborg or elsewhere on the Olympic Peninsula here are answers to a few burning questions (This conversation will be centered on home buyers in Clallam County because we have a few options that other communities might not).

(back to the top)

1) First, how much will it cost? That depends on whether you are a cash buyer or borrowing the money. Just like buying a car, if you are a cash buyer you might say “All I have is $6,000 – take it or leave it” because in fact all you have is $6,000 and if the seller wants more money it’s just too darn bad. If you are borrowing money from a lender whether it’s a car or a house, then your question might really be “What is my monthly payment?” which is directly related to the purchase price but in monthly scoops just like the rent you pay now or your monthly cell phone bill.

I recently looked in the Multiple Listing Service database (kind of like Google but only for Realtors) at home sales. You might be surprised that houses are selling between $10,000 - $800,000. Before you jump on the “Hey, I want a $10,000 house” parade, that one is a mobile home in a retirement community.

Realistically, your average first house in going to be priced somewhere between $150,000 - $225,000 depending on YOU! How many bedrooms, how many bathrooms, does the backyard need to be fenced, do you need to be near the bus-line, near schools, have a view? The choices are yours and those choices affect the price.

Your monthly mortgage payment will most likely fall between $800 - $1,300 month.

(back to the top)

2) Can I afford it (I don’t want to go through a foreclosure someday)?

Thanks to the banking meltdown of 2008-2009 lenders have become much stricter about who they will lend to – BUT WAIT, there’s more! If you have an income, if you have a job, and have paid your bills either on-time or mostly on time, a lender will want to lend to you.

Believe it or not, our friends in the Government have laws about how much “we” are allowed to say about loan payment and interest rates so raise your right hand and repeat after me: “I solemnly swear that the information I receive is approximate and that I understand that interest rates can changes, and that banks might charge fees that my Realtor does not control and this is not a quote for a loan or a commitment for a loan it is just information and an example of how much a monthly payment could be with current lending standard.” Whew. Thanks, I feel better now.

- If you borrow $250,000 at 4.5% interest your payment will be $1,266.71 per month.

- If you borrow $250,000 at 6.05 % interest your payment will be $1,506.92 per month.

- Remember, your first home on the Olympic Peninsula will most likely cost much less than $250,000.

(back to the top)

3) How do I know which house to buy (I’ve already made enough mistakes in my life!)
 

Buying a house is like dating. You might fall in forever-love with the first house you see but most likely you will look at several houses before you find The One.

The two most important factors when buying a house are your lifestyle and the ability to sell it again someday.

Some teenagers go through a phase of wanting to paint their bedroom walls black. Most houses for sale on the market do not have black walls, that’s because most buyers are not feeling the black wall groove. When you buy a house, someday you’ll sell it, but the someday - resale should not overshadow the reality of your day-to-day life.

(back to the top)

Example:

What I want in a house:

Once you’ve made your list, prioritize your top five and your Next-Five-Wish List and get ready to look at houses

Example:

CAUTION: Only you know your true lifestyle and picking your house to buy is a personal decision. Your friends, your family and your therapist will all have opinions about which house you buy so I leave you with the famous words of Joseph Campbell: Follow your Bliss and the universe will open doors for you! (Best real estate quote ever)

(back to the top)

1) Who is going to lend me the money? (You’ll have a surprising number of lenders to choose from)

There are banks and mortgage brokers and lenders aplenty just hoping to work with you. If you are buying a house in Sequim or Port Angeles area – anywhere on the Olympic Peninsula – I recommend AGAINST using online lenders. Internet lenders will generally cost you more in “fees” and “costs” that you might not know about, and they charge more to process the paperwork out-of-state and send out-of-area appraisers to a job that requires in depth local knowledge (if they don’t where the garbage dump is, or where the golf courses are, how can they understand local pricing?)

Interview three lenders and find the one that clicks with you personally and is competitive in price.

(back to the top)

2) What if my credit isn’t perfect? (That’s OK, we’ll work to improve it)

Most people fall short of a perfect credit score. Lenders want to lend to people who will repay them. A confidential consultation with a good lender will give you the pointers you need to clear up any credit issues that could stall you when buying a home.

Once you decide to buy a home DO NOT DO ANYTHING THAT AFFECTS YOUR CREDIT such as buying anything on credit (a new car to go with that new garage – NO!). DO NOT quit your job, get a new credit card, max out a credit card, borrow against a line of credit, skip a car payment, elope, or anything that would make a lender say HMMMmmmmm. Buying a home requires avoiding temptation throughout the lending process.

(back to the top)

3) Can I buy a house if I’m single? Married? Have kids? Just got a new job? Am self-employed? What if I just got divorced? (Yes times seven)

Yes, yes, yes, yes, yes, yes, yes! Anyone who has the money, or is creditworthy enough to obtain a loan, is eligible to buy a home. We do not discriminate against anyone – ever.

_________________________________

(back to the top)