How to Buy a Home: Your Step by Step Guide

A living room with dark hardwood floors and blue walls.

Homeownership is closer than you think!

If you’ve long been considering buying a home in the greater Raleigh area, now is the time to act. You might be worried about the financial side to buying a home: the hefty down payment and the mortgage approval process—but it’s really not that complicated.

In fact, there are ten simple steps to buying your first home in the Raleigh real estate market!

Save Your Down Payment

It’s a common misconception that you have to put down 20% of the home’s overall value. That’s simply not true!

There are a number of loans out there that require less than 20%, with some like the USDA Loan requiring only a 3% down payment and the VA loan requiring 0% down!

While it’s true that the more you save up for a down payment, the lower your monthly mortgage payments will be, 20% is not the end-all be-all.

Determine Your Credit Score

A man using a marker to circle different numbers on a graph.

Whenever you’re making any large purchase that requires a loan, it’s important to have a handle on your finances. Use a free service like CreditKarma or FICO to check your score. This will give you a good idea for what kind of interest rates the bank is willing to offer you.

Find an Agent

While it is possible to buy a home without an agent, it is twice as stressful. An agent handles a lot of the “invisible work” associated with buying a home.

In addition to handling negotiation and closing, your agent can make recommendations on local neighborhoods and homes for sale. Plus, they’ll likely be able to offer you support as you navigate a tricky real estate market.

Get Pre-Approved

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Trust us, getting pre-approved for a mortgage loan will make the rest of your home-buying experience easier.

This process typically includes sitting down with a lender to review your finances. The lender will go over your credit score, savings, outstanding debt, annual income, and anything else relating to your money situation. Then, they’ll give you an offer for the amount of money (and the interest rate) the bank is willing to lend you. Boom: your budget is set.

Go Shopping

Now it’s time for the fun part! Think long and hard about what you want in a home, and get to searching. To make it a little easier on you, feel free to use our complimentary home-search tool.

You can easily filter results by price, location, neighborhood, size, special features, and more. Happy house hunting!

Make an Offer

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Once you’ve found a home that you can’t live without, work with your agent to make an appropriate offer. It’s important to make an offer that is both competitive enough to sway the seller, while still staying within your budget.

Remember that pre-approval letter? This makes you a more competitive buyer as well!

Get an Inspection AND an Appraisal

This is crucial. Before you sign any closing documents, you HAVE to make sure the home is a worthwhile investment. The best way to do that is by hiring an inspector to come out and review the property. This way, if there are any hidden issues with it, you’ll be able to negotiate with the seller to have it fixed.

After the inspection, your lender will arrange for a home appraisal. This is to assure the bank that your new home is worth the price you’ve agreed to pay for it.

Close the Sale & Move In

Once your loan is approved, your bank will schedule a closing date. This is when you cross your T’s and dot your I’s.

Congratulations! After some heavy negotiating and serious home shopping, you’ve finally found your dream home and made it your own.

Ready to Become a Raleigh Homeowner?

We can help with that. At Linda Craft & Team REALTORS®, we have the experience necessary to help you find the home of your dreams at the right price tag. Give us a call today to get started.

Home Buying Round Up: Let’s Talk About Your Credit Score

If you’re thinking about buying a home in Raleigh, you’ve probably checked your credit score at least once, and maybe even been a bit dismayed at what you found.

The truth is, many would-be homeowners out there feel like their credit score has to be in the high-700s in order to buy a home. Luckily, we’re here to set the record straight.

You Don’t Need an “Exceptional” Credit Score to Buy a Home

Did you know that only 19% of Americans have a credit score between 740 and 799, according to Experian?

Having a low credit score doesn’t mean you can’t afford, or won’t be able, to buy a home. There are a number of unique loan programs out there that don’t have a credit score minimum, and may not even require a hefty down payment.

Here Are Some Loan Examples

A man writing on some papers with a pen.

The Fair Housing Administration offers a unique FHA loan that only requires a credit score minimum of 580, if you want to qualify for the low down payment advantage.

The U.S. Department of Agriculture does not set a minimum, but lenders throughout the industry typically require around 640.

For active-duty or retired military members, the Veterans Affair loan does not set any credit score minimum requirement.

The bottom line? You can still be approved for a mortgage even if your credit score is below a 700.

Don’t Have a 700+ Score? You Can Still Buy a Home in Raleigh

Be honest: when is the last time you checked your credit score? Many Americans refrain from checking it because they fear it’s too low.

However, according to FICO, the average credit score has steadily risen year after year! In 2009, the average FICO credit score was around 680. In mid-2018, it had risen to around 704.

If you’re worried about your options as a homebuyer, we highly recommend checking your credit score. The result may surprise you!

Still Worried About Buying a Home?

Please give us a call. We would love to sit down with you to discuss your home-buying options in the greater Raleigh area. In addition to our extensive real estate network and resources, we are connected with a number of lenders in the area we’d love to recommend.

Homeownership is more attainable than you think! Please reach out to us at Linda Craft & Team REALTORS® to learn more about buying a home in Raleigh.

Applying for a Mortgage? DON’T Do These 7 Things!

Three adults meeting at a table to discuss their mortgage loan.

If you’re currently searching for a home to buy in Raleigh, chances are you’ve already thought about applying for a mortgage.

Obtaining a mortgage loan is a huge part of the buying process, as it has an enormous impact on how much you can afford and how much your monthly payments will be.

As such, it’s important to be extra cautious with your finances—and your credit—while you’re applying for a mortgage in Raleigh. Time and time again, we hear from clients about the mistakes they’ve made while waiting for their mortgage loan to finalize. We want you to make decisions that guarantee financial success—which is why we want to share with you the following list of things to avoid after you’ve applied for a mortgage:

Don’t Change Jobs or Get a Demotion at Work

While this may sometimes be out of your control, do everything in your power to maintain consistent employment during the approval process.

Changing from salary to commission, or deciding to go freelance, should really wait until after you’ve closed on your home.

Avoid Depositing Large Sums of Cash Into Your Account

Hand pulling several hundred dollar bills out of a wallet.

Cash is untraceable, and during the approval process your loan officer will be taking a close look at your checking account.

They want to make sure your cash flow is accounted for and traceable, so if you do need to deposit cash into your checking account make sure you talk it over with your bank first.

Do Not Make Any Huge Purchases

This includes buying a car, expensive furniture, or anything else that’s going to put you in any more debt! Hide your credit cards from yourself if you must.

If you go into too much debt during the approval process, you may no longer qualify for that loan amount. This happens if your ratio of debt to income becomes too debt-heavy.

Don’t Volunteer to be a Cosigner

A man about to sign a stack of paperwork.

When you cosign on someone’s loan, you’re then obligated for their loan if they default. This affects your debt-to-income ratio which may then disqualify you from the loan that you’ve applied for.

Don’t Change Bank Accounts

Remember, your loan officer needs to be able to track your sources of income and spending. Having a consistent bank account and transactions makes this ten times easier.

Don’t Apply for New Credit Cards or Loans

A pile of money next to a checkbook.

Don’t apply for any new credit accounts! Hard inquiries on your credit may negatively affect your FICO score.

If your score drops too much in a short amount of time, you may no longer qualify for your loan.

Don’t Close Any Accounts

Closing a credit account also negatively impacts your score! Your credit score is based upon both the length and depth of your credit history.

Closing an account affects that depth. Your credit score is essential to your mortgage loan interest rates, so it’s critical to keep them as high as possible when applying for a mortgage!

Still Shopping for a New Home? Our Team is Here to Help With That

From showing you “Coming Soon” listings that haven’t even hit the Raleigh market yet to offering guidance and advice on applying for your mortgage, Linda Craft & Team REALTORS® are here to help.

Give us a call today to discover your home-buying options in the greater Raleigh area!

Greater Raleigh Real Estate: Homeownership is More Attainable than Ever

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After the housing market crash of 2008, homeownership rates throughout the country have decreased dramatically. At one point prior to the crash, the homeownership rate was over 69%. In the years following, it dropped to its lowest point at 63.7%.

As homeownership in Raleigh continued to decrease throughout the late 2000s and early 2010s, many began to wonder if it was no longer an essential part of the American dream.

Here’s our take on it:

Homeownership Will Always Be a Cornerstone of the American Dream

A row of suburban homes with American flags displayed outside.

Owning a home is as American as apple pie and baseball. According to a recent report by the Census Bureau, the home ownership rate has actually increased steadily over the last two years.

Today, it stands at about 64.8%. That’s a 1.1% increase from its lowest point in 2015. While it’s still not nearly as high as it was at its peak, this growth is a good thing! It shows that buying a home is still a huge financial goal to many.

The Desire for Homeownership is Strong Across All Generations

Modern kitchen.

With millennials poised to take over the real estate market, we’re expecting homeownership rates to continue rising steadily in the following years.

After all, there are so many benefits—both financially and emotionally—to buying a home. We’ve written about it extensively, but owning a home improves your life in more ways than one. It gives you financial security, allows you to grow your wealth by building equity over the longer term, and provides you a stronger emotional attachment and investment in your community.

If you’ve long been thinking about joining the ranks of homeownership, now is the time to act!

It’s a Great Time to Become a Raleigh Homeowner

With the summer real estate market gearing up in Raleigh, now is a great time to make your Raleigh homeownership dreams come true. The current inventory of homes for sale in Raleigh has never been better.

Here at Linda Craft & Team REALTORS®, we have a ton of resources to help you locate the home of your dreams. In addition, allow us to use our expertise to help you negotiate the best possible price, navigate your relocation with ease, and achieve all of your real estate goals.

Give us a call today to learn more!

Good News for Buyers: Bidding Wars are Decreasing!

Two story brick home in a suburban setting.

If you’ve been in the market for a new home, you’ve likely seen (or been a part of) a bidding war. This is fairly common when you’re in a market like ours; one that’s seller-focused due to a discrepancy between housing inventory and demand.

In short, a bidding war is when two or more parties consistently outbid each other as they compete to purchase the same thing—in this case, a home for sale in Raleigh.

Over the past several years, as inventory decreases and demand goes up, bidding wars have become all the more common. But, if you’re a buyer looking for your dream home in Raleigh, we’ve got some good news!

Bidding Wars are Decreasing

In January of 2018, 53% of houses sold included a bidding war before a final price was agreed upon. In January of this year, that number went down to just 13%.

This is good news for buyers! It means the real estate market is slowly returning to “normal.” While it is still a highly advantageous time for sellers in Raleigh, the scales are tipping a little more favorably towards buyers as well.

Inventory is Increasing

Aerial shot of suburban neighborhood.

Over the past few months, we’ve seen a steady increase in Raleigh’s housing inventory. More homeowners are choosing to list their homes, because they want to take advantage of the great seller’s market!

This influx of homes being listed is a good thing for buyers. It means they’ll have more options to choose from, and they won’t have to worry about a stressful bidding war breaking out over their dream home.

It’s Still a Good Time to Sell Your Home

If you’ve long been considering selling your home, now is still a great time to list! Although inventory is steadily increasing, it’s still nowhere near enough to match buyer demand.

With the current level of housing inventory for sale, it would take about 3.7 months for all the homes listed to sell if no additional listings came to the market. Whenever this supply amount falls under 6 months, then you’re in a seller’s market.

Whether You’re Buying or Selling, Rely on Linda Craft & Team REALTORS®

Navigating the Raleigh real estate market can be tricky. That’s why it’s so important to have a professional REALTOR® on your side.

When you work with Linda Craft & Team, you’re enlisting the help of local experts with years of experience buying and selling unique properties in the greater Raleigh real estate market. From pricing your home to showing you hidden listings and more, Linda Craft and her team of agents will be there for you every step of the way.

Give us a call today to learn more!

Homeowner Perks: The Many Benefits that Come with Buying a Home in Raleigh

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If you’re planning on buying a home in Raleigh soon, you’ve probably already started weighing the pros and cons. While buying a home is a huge transaction, and an even bigger investment, it will improve your lifestyle, finances, and overall well-being for years to come.

In fact, there are a myriad of benefits—both financial and emotional—you can expect to receive after you’ve closed on your home. Some of these perks might even surprise you!

Let’s take a minute to explore the three big ways owning a home is going to change your life for the better.

It Will Improve Your Finances

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For many years, owning a home has been considered one of the biggest parts of the American Dream. As such, it’s no surprise that it can help you improve your finances for the long-term.

Look at buying a home as making a big investment. In truth, it’s also a forced savings account. When you pay off your mortgage, month-by-month and year-by-year, you’re building equity. Eventually, when you pay off your mortgage completely, you’ll own your home outright, as well as all the equity you’ve put into it.

When you live in an area that’s constantly in demand, much like Raleigh, you can expect your home value to increase substantially long after you’ve purchased it. What does that mean for you? More money, increased savings, and a secure financial future.

And Increase Your Net Worth

On average, a homeowner’s net worth is usually about 44 times that of a renter!

Plus, owning your home means more stability. If you opt for a fixed-rate mortgage, you won’t have to worry about constantly increasing rent payments every year!

It Improves Your Quality of Life

Happy active adults walking through a park.

Owning a home means so much more than just having a place to sleep at night. It guarantees stability, shelter, and long-term happiness! After all, your home is so much more than just a house: it’s a place where you go to feel comfortable, safe, and protected.

In that spirit, here are some of the biggest emotional perks that come with owning a home in Raleigh.

Community Involvement

When you own a home in a community, you’re truly able to put down roots and invest in what’s going on. You also have a network of neighbors and friends to depend on when you need help.

Lifestyle Security

There are a number of unique benefits associated with owning a home! For example, homeownership may have a positive impact on a child’s education, specifically in math and reading.

Homeowners are also more likely to have substantial health advantages over renters.

Creative Freedom

You have complete freedom to decorate and upgrade your home as you see fit! Whether this includes unique paint jobs, tearing down a wall to create a more open floor plan, or installing a pool in the back yard, you can do whatever you like!

Ready to Buy a Home in Raleigh?

We’re ready to help. At Linda Craft & Team REALTORS®, we possess a unique expertise when it comes to the greater Raleigh real estate market. Feel free to browse our complimentary home-buying resources and guides, and let us know if you have any questions.

Give us a call today to learn more about the Linda Craft & Team Advantage!

No, We are Not Headed Towards a Housing Crash: Here’s Why

In the past few months, you may have heard whisperings about an incoming housing market crash. We’re here to put you at ease: we are not headed towards a crash!

A lot of this concern comes from average home prices slowing in growth across the country. We wrote a blog about it last week, but this is not a bad thing! It just means the market is shifting back towards normal.

The Three Most Important Factors

A luxury home interior with a fireplace.

Today’s market is wildly different than the pre-crash housing market of the late 2000s. We’re going to show you why and how using three important metrics that measure the Raleigh real estate market.

Home Prices

Beginning in 2008, average home prices in the U.S. dropped almost 29% over a four year period. That’s drastic, and it’s what spurred the housing market crash!

Today’s average home prices are not depreciating. It’s just that the level of appreciation is slowing down. Over the last year, homes have increased by more than 4%.

While this is less than the 6-7% prices appreciated over years prior, it in no way indicates that we’re headed towards a crash!

Mortgage Standards

A white table with a checkbook and small stack of money.

In the current real estate market, it’s considered easier to get a loan from the bank than in years prior. Many are concerned that these “lenient standards” will contribute to a housing crash.

However, the Urban Institute’s Housing Finance Policy Center released a quarterly index that details the percentage of home purchase loans that are likely to default. When this rate is very low, it indicates that lenders are unwilling to tolerate defaults. This makes it much harder to get a loan.

When that percentage is higher, it indicates that lenders are more lenient so it is easier to get a loan.

In another report called the Housing Credit Availability Index, the Urban Institute also revealed that there is still ample space to expand the housing market credit box. Even if the current risk of default was twice what it currently is, it would still be well within the pre-crisis standard of 12.5%.

Foreclosure Rates

In the last 10 years, foreclosures and short sales have made up 35% of all home sales. That’s huge!

At the end of the fourth quarter of 2018, the percentage of loans in the foreclosure process was just 0.95%. It hasn’t been that low since 1996!

Ready to Explore the Raleigh Real Estate Market?

Linda Craft & Team REALTORS® is ready to help. Give us a call today to learn more about the best way to buy a home in the greater Raleigh market.

Rely on our expertise, our extensive resources, and our proven track record with buying homes in Raleigh. We’ll guide you towards a successful outcome in the Triangle, guaranteed.

The Real Estate Market is Returning to “Normal:” Here’s Why That’s a Good Thing

In the past couple of months, we’ve written about how the Raleigh real estate market is primed for sellers. That’s because of a discrepancy between housing demand and housing supply.

When there aren’t enough homes for sale to satisfy buyer demand, home prices rise. In fact, over the past few years, home price appreciation has averaged around 6% across the country. These conditions are known as a “seller’s market.”

So What’s Changing?

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The market is starting to level out a bit. Home price growth has begun to cool down, with a recent report by CoreLogic showing that prices have only risen by 4.7% over the last year.

While housing prices have by no means stagnated, many buyers and sellers are still worrying that this recent activity means another housing crash is on the horizon.

Don’t Worry, the Market is Doing Just Fine

A business professional showing a client shifting trends in market activity.

Sure, the market is cooling off a bit, but that’s not a bad thing! It also does not indicate that we are headed for a crash.

It means that the real estate market is returning to “normal.” The inventory of homes for sale is growing to meet buyer demand, so housing prices aren’t increasing dramatically.

This is good for buyers: it means that housing prices aren’t skyrocketing, so more people will be able to afford homes in their preferred neighborhood.

Will Housing Prices Go Up Again?

Sold house sign in Midwest suburban setting. Focus on sign.

Most likely, yes! The Joint Center for Housing Studies at Harvard University estimates that over 30 million new households will enter the market from now through 2040.

Is Now the Right Time to Buy a Home in Raleigh?

Yes! If you’re interested in buying a home in Raleigh, or anywhere else in the NC Triangle, now is the time to act. Here at Linda Craft & Team REALTORS®, we have the resources and expertise to assist.

Just give us a call today to learn more! You can also browse our home-buying resources, see what homes are currently going for in Raleigh, and explore specific communities in the Triangle.

First Comes Love… then Comes Your First Mortgage Payment!

Every year, the National Association of Realtors® conducts a survey to determine the profile of home buyers and sellers across the country.

The 2018 profile is interesting because the majority of recent homebuyers (a whopping 63%!) are married couples!

The Majority of First-Time Buyers are Married Couples

A married couple standing on the porch of their new home.

It’s true! According to the NAR, 54% of first-time buyers in 2018 were married couples.

However, if you’re still single, there’s no need to worry. 18% of first-time home buyers in 2018 were single women, while 10% were single men. In addition, about 16% of these buyers were unmarried couples.

Homeownership is Within Your Grasp!

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Even if you haven’t saved up an enormous down payment, you likely still have plenty of options for buying a home in the greater Raleigh area!

Many homes for sale in Raleigh, and the Greater Triangle area, qualify for loans that don’t require huge down payments. You may be able to use an FHA loan or a USDA loan to purchase a home in one of Raleigh’s orbiting cities—in communities like Angier, Fuquay-Varina, and Apex.

These loans are popular because they only require a down payment that’s 1 – 3% of the home’s overall price. And, if you’re in the military, you have even more options!

Let’s Buy Your Dream Home Together

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If you’d like to explore your home-buying options in the greater Raleigh area, please give us a call at Linda Craft & Team REALTORS®. Whether you’re a first-time buyer or looking to invest in your fifth real estate property, we have the resources and expertise to assist.

Let’s set up a time to talk about your plans! In the meantime, feel free to explore the Greater Raleigh area with our free home-buying guides.

How Homeownership Makes the Biggest Difference

If you’re looking for the most surefire way to build your wealth, become a homeowner. We’ve blogged about this in the past, but it really is one of the most effective (and simplest) ways to build your wealth for the long term.

The majority of homeowners take out a mortgage loan to buy their home. By paying off your home’s mortgage every month, you’re building your wealth. Although it feels like you’re paying somebody else (the bank) you’re actually putting money into a forced savings account.

And forcing yourself to save money pays off. Big time.

It Helps You Achieve the American Dream

A core part of what many consider “The American Dream” is owning a home. Owning your own home brings a myriad of benefits, both financial and non-financial.

Financially speaking, buying a home and becoming a homeowner increases your net worth. Every time you make a mortgage payment, your net worth goes up a little.

Here’s an example: in a study performed by The Joint Center for Housing Studies at Harvard University, researchers found that the difference in net worth between homeowners and renters over 65 was 47.5 times greater.

In that study, nearly half of those homeowners’ net worth came from their home equity!

It’s a Huge Retirement Benefit

Studies show that homeowners over 65 are more financially prepared for retirement. Even if they choose to sell their home and downsize for retirement, they have the added bonus of owning their home for a long time—meaning their home has likely increased in value.

Now, when they choose to sell their home, they’ll make an even bigger return on their investment.

Although renting may seem like an affordable option short-term, it’s less lucrative in the long term. This is especially true when you consider that median rent prices have increased substantially every year.

Plus, It Has Emotional Benefits

You deserve to love where you live. That’s the biggest emotional benefit you get from owning your home: you get to put down roots and invest in a community that will improve your quality of life.

When you buy a home in a community like Raleigh and the NC Triangle, you’re signing up for an exciting, well-rounded lifestyle! The Triangle has plenty of small towns, gorgeous real estate options, and maybe even a major city or two.

Ready to Become a Homeowner?

We’re ready to help. Start building your wealth and guaranteeing yourself a more successful retirement by buying your dream home in the greater Raleigh area.

Just call us, Linda Craft & Team REALTORS®, today to get started. You can use our free home-buying resources, easily search for homes in the area, and see popular Raleigh homes for sale.