Tag: buying a home

Credit Mistakes That May Keep You From Buying a Home

Before you think of buying a new home, it is necessary to determine if your credit score is in excellent shape; when reverse is the case, your dream of owning a new home might dash to pieces.

Having a good credit score will always work in your favor since you wouldn’t have issues getting your mortgage approved. A bad credit score, on the other hand, does more harm than good.

As you try to find your way around the home buying experience, here are some credit mistakes you probably should avoid.

  1. Forgetting Your Credit Reports

When you apply for a mortgage or seek a loan from a lender, what they often go through is your credit report. It will enlighten them on your financial capacity, and also stir their decision.

Since they will be looking at this credit report, you must know what’s there before you sit with your bank or lender.

You can pull out your credit reports from one of the major credit bureaus like Equifax, Experian, and TransUnion.

  • Late Bill

Aside from your credit report, another mistake you shouldn’t make it paying your bills late. It can be a glaring red sign, and lenders don’t like late bills.

Although your credit score is a huge factor, your payment history is also something that is hardly ignored. That is because it shows how financially responsible you are.

When you make a late credit loan or, perhaps, student loan, it shows you can’t keep up with your bills

  • Going On A Shopping Spree

A new home entails shopping for some home appliances, furniture, and lots more. But wait, you don’t have to dabble into that just yet.

When you max out your credit card or maybe open some new credit accounts, it could hurt your credit score, which can be saddening.

It would help if you didn’t make any substantial financial moves to avoid making a mistake. 

  • Falsely Disputing Negative Items On Your Credit Report

You are eligible to dispute some inaccuracies in your credit reports, such as charge-offs and late payment. 

However, do this only when you’re convinced that the information is inaccurate. If there were indeed an error, it would take your credit bureaus about 30 days to ratify the issue. 

If there were an error, the negative mark would be erased almost immediately.

  • Accepting Bad Loan Terms Due To Poor Credit

It is one of the biggest mistakes you shouldn’t make since it never plays in your favor. As much as you need your new home, you shouldn’t get it under a bad credit score.

That will only mean lousy loan terms, higher interest rates, and high monthly payments. No matter how tempting it might be, resist the urge to acquire a loan using a bad credit score.

Conclusion

Many people have made these credit mistakes when buying their first homes. But if you can avoid it, it makes everything less hostile and manageable to pay off. A good credit score is vital for lasting peace of mind.

4 Ways to Save Money When Buying Your First Home

When you are buying a new house, chances are you want your deal to the best one possible. Finances are always important when trying to buy a home. It is therefore essential that you consider the following ways to save money so that you can buy your first home without being overly stressed out.

  1. Hire a seasoned and local real estate agent

Nobody knows the area like a real estate agent that works there. Using a local and experienced real estate agent will save you money because they know the business of buying homes in that area. They also have information relevant to the market that will help them negotiate a good contract that will protect you and save you money. The best way to find good local realtors is to ask for referrals from friends and family or check online on websites like Trulia and Zillow.

  • Have a great Credit Score

The higher your credit score is, the lower your mortgage interest rate will be. This also means that you will pay less in lenders fees and therefore have a cheaper loan. Before starting to home purchase process, you should first ensure that all your credit card balances are paid off. You also need to try to maintain a balance below 15% of credit limit on all your credit cards. You should also not apply for any new credit facility or loan while trying to improve your credit score because they require hard inquiries of your credit report which will cause your credit score to drop.

  • Shop around for better loan rates

There are many lenders in your area that are willing to give you a mortgage. It is in your best interest to ensure that you go through as many of them to make sure that you compare rates. This will help you to know which one is the cheapest in its entirety. Sometimes a low interest rate does not mean that it is the cheapest option for you. Speak to your realtor to check what the final figure comes to with fees and charges and this will help you get the best possible deal for your home.

  • Shop for homes in the winter period

The housing market is least aggressive in the winter because there aren’t a lot of people selling. You may not have as much choice, but you will certainly have sellers in the market that will offer you fair prices. You can actually save up to $20,000 on the price of your first home if you shop in the winter.

For more information or any questions regarding sales tips for real estate agents, contact Chang Legal today.

What to Expect at a Real Estate Closing

If you’ve never bought or sold property before, the process of closing on your real estate deal may seem a little mysterious. Who is there? What do you need to be prepared for? What will happen? There’s no doubt: closings can be complicated events. In fact, it’s even a bit difficult to tell you “what to expect” in a general sense – every closing is unique. So here are some broad strokes on what a closing entails.

What is a real estate closing?

The real estate closing is the last step in a real estate transaction. This is where you get (or give) thekeys. It’s the point of no return (but it’s not that scary). Transfer of ownership generally happens when one party turns over the deed of the property to the other party – but it’s typically a lot more complicated than simply signing on the dotted line…

 

 


Who is present at the closing?

The list of who is present at a closing can vary slightly from situation to situation, but here is a general list of the major players at a closing:

  • The seller or the builder’s representative (if it’s a new home)
  • The buyer
  • Attorneys for the seller and the buyer
  • Real estate agents for the seller and the buyer
  • The mortgage lender / representative
  • The title company representative (sometimes one in the same as the mortgage lender’s representative)
  • The closing agent – this is the person who is in charge of guiding the proceedings. Sometimes the closing agent is also the title company representative or another person on this list.
  • A notary public

What do I need to do before the closing to assure it goes smoothly?

Your attorney will review all of the closing documents prior to closing to ensure everything goes smoothly. Your attorney will make sure you have taken all the appropriate financial steps before the closing and will let you know exactly what will happen at your particular closing.


There is one other very important step you should take before closing on a property that you are purchasing: 24 hours before the closing, you should do a final walk-through of the property. At this point, you can determine if any changes have been made to the property or if there is any damage to the property that wasn’t there when you signed the contract. If there are problems with the property, they should be dealt with then – not at the closing. Whether or not you are working with a real estate attorney, please do not skip this step – you don’t want to complete the closing, only to find out that you’re going to have to pay for repairs that you did not expect.

Where does the closing happen?

A closing can happen anywhere, but usually takes place at the offices of one of the professionals involved.

What am I expected to bring to the closing?

The answer to this question depends, of course, on whether you are the buyer or the seller and in either case, your attorney will prepare you and make sure you have everything you need. In general, if you are the seller, you need to bring the keys to the property (if applicable). If you are the buyer, you will generally be paying money at the closing, but that doesn’t necessarily mean you’ll be bringing a check with you. The most important thing to remember as a buyer is to communicate with your attorney, who will be sure you are ready for the closing.

What are the actual steps of a closing?

You’ll be doing a lot of signing at the closing so warm up your John Hancock skills. As a buyer, some of the most important documents are those that detail the terms of your mortgage loan. These are complex legal documents that use industry-specific terms that may be unclear to someone who is not a legal real estate professional. Your attorney will thoroughly review these documents – usually before the closing itself – and will make sure its safe for you to sign the documents.

If you are working without an attorney, it is crucial that you pay close attention to these documents. If you see anything you don’t understand or see something that isn’t what you expected, do not sign the loan documents until the issue has been resolved. Once you sign these documents, they are binding legal contracts.


At a closing, you will likely sign the following documents:

  • Closing disclosure / settlement statement – this is a list of all your credits and charges. It is itemized and at the bottom will list the amount you owe. You and your attorney should receive this document a few days before the closing so you can review it thoroughly.
  • Mortgage / promissory note: this is your “IOU” with the mortgage lender.
  • Mortgage / deed of trust: this document secures the mortgage / promissory note.
What can go wrong at a closing?
Optimally, your closing will be smooth sailing; having a real estate attorney as your partner in this process can help make sure that happens. But sometimes even when we do all the right things and follow all the steps, events that are out of our control occur. In fact, there are enough crazy stories out there about ruined closings that we’ll save those details for another time.

That being said, should your closing hit a few bumps in the road, it’s more important than ever to have an experienced real estate attorney at your side, whether you are the buyer or the seller. At Chang Legal, we have the experience necessary to guide you confidently through the process and to help you manage any problems that may arise along the way.


If you are thinking about buying or selling property, we’d love to chat with you about how Chang Legal can help make the process as easy and as successful as possible for you. Please email us at ContactUs@changlegal.com or call 847-907-4971 today.

10 Real Estate Terms You Should Know

At Chang Legal, we’re here to help you get through the often confusing process of legal real estate transactions, but we’re also here to help you learn more about how real estate law works. As is true of any industry, real estate law has its own set of terms that may not make sense to someone not well-versed in the field. Listening to a banker, real estate lawyer, and sometimes even a realtor can make some people feel like they are speaking another language. So with that in mind, here’s a list of the top 10 most important real estate law terms that you should know.

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