Home Buying 101: A Handbook and Guide While Buying Your Dream Home!

By Revathi Raja Kumar and Saravana Gupta Ravindran

A Handbook and Guide While Buying Your Dream Home! from a real estate agent.

• Language: English
• Publisher: Revathi Raja Kumar
• Release date: Mar 24, 2022
• ISBN: 9781005181512

Revathi Raja Kumar

I started my real estate journey when I bought my dream home several years ago. I didn't know a lot, but was very curious to learn more. This curiosity drove me to keep learning more. I refinanced the mortgage multiple times to take advantage of the lower interest rates. I refinanced to 15 year mortgage to lower interest rate even further.Had a mindset change to focus on expanding income instead of reducing expense. Explored further on this to understand the single family rental market. Spent several hours on BiggerPockets website to learn and then became a landlord. To expand my understanding further completed hundreds of hours of Pre-Licensure education, took the license tests on Mortgage Broker, Real Estate Agent, Insurance Agent, Notary Public and aced all.Teaching and helping others has been a passion for me since my childhood. I am passionate and dedicated in whatever I do. I became a volunteer to teach Tamil to kids. To take a step further became a woman entrepreneur to help others in their real estate journey.I am now a licensed Mortgage Broker in California & Texas, licensed Insurance agent providing services in California & Texas, Real Estate agent in California Bay area.Come join me and Let's make it happen!

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Revathi Raja Kumar & Saravana Gupta Ravindran

Home Buying 101

A Handbook and guide while buying your dream home!

First published by Revathi Raja Kumar & Saravana Gupta Ravindran 2022

Copyright © 2022 by Revathi Raja Kumar & Saravana Gupta Ravindran

All rights reserved. No part of this publication may be reproduced, stored or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise without written permission from the publisher. It is illegal to copy this book, post it to a website, or distribute it by any other means without permission.

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I dedicate this book to my loving mom, beloved husband and my wonderful son for inspiring and supporting me through this journey!

Contents

About the Author

1. Home buying process

2. Deciding on Buying Vs Renting

3. Credit Score and Financial health

4. Mortgage Preapproval process

5. Affordability, Down payment and Mortgage options

6. Finding a Realtor

7. Home searching process

8. HOA - CC&Rs

9. Make An Offer

10. Seller’s Disclosure

11. Get A Home Inspection

12. 15 Yrs Vs 30 yrs mortgage

13. Home Appraisal

14. Purchase Homeowners Insurance

15. Title Insurance

16. Final walk through

17. Set up utility services

18. Close your home & get keys

19. Moving to your new home

20. Tips for moving with kids

21. Tips for moving with Pets

About the Author

I started my real estate journey when I bought my dream home several years ago. I didn’t know a lot, but was very curious to learn more. This curiosity drove me to keep learning more. I refinanced the mortgage multiple times to take advantage of the lower interest rates. I refinanced to 15 year mortgage to lower interest rate even further.

Had a mindset change to focus on expanding income instead of reducing expense. Explored further on this to understand the single family rental market. Spent several hours on BiggerPockets website to learn and then became a landlord. To expand my understanding further completed hundreds of hours of Pre-Licensure education, took the license tests on Mortgage Broker, Real Estate Agent, Insurance Agent, Notary Public and aced all.

Teaching and helping others has been a passion for me since my childhood. I am passionate and dedicated in whatever I do. I became a volunteer to teach Tamil to kids. To take a step further became a woman entrepreneur to help others in their real estate journey. I am now a licensed Mortgage Broker in California & Texas, licensed Insurance agent providing services in California & Texas, Real Estate agent in California Bay area.

Come join me and Let’s make it happen!

One

Home buying process

Chapter Separator

The process of buying a home may be exciting and overwhelming at the same time. Apart from financial perspective, there are also a number of other factors to be considered. There are certain steps to be followed in a home buying process. If you are a first time home buyer, this might help as a guide to go through the home buying process step by step. If you are an experienced home buyer, this might help to keep track of the home buying process.

Two

Deciding on Buying Vs Renting

Chapter Separator

Inflation

When you buy your home, there are fixed and variable costs. The fixed costs are mainly your mortgage - principal & interest. The variable costs are property tax, HOA, repairs & maintenance, etc… The mortgage is the biggest expense and if you get a 30 Yrs fixed mortgage the cost is fixed for the entire duration of loan. Let us assume your income is currently $100k and If the wage inflation is steady at 2% for the next 30 years, your income will grow to $181k. Your earnings grows, but your mortgage is fixed. But if you rent instead the rent grows along with your income and you need to hope that the earnings grows at least at the rate of rental inflation.

Your primary home is not an investment

Your home provides one of the basic necessities - Shelter. Your primary home will not generate a cash flow. There is a lot of emotional value in living in your home, which cannot be calculated mathematically. Math can only go so far and this is one of the scenarios it breaks. If you are not planning to sell your home, then it’s technically not an investment.

Apples to Apples

When you compare the rent of a two bedroom apartment vs a single family three bedroom home, its not apples to apples. You should compare renting single family vs buying single family home. The mortgage comprises of principal and interest. Most likely the property tax will be covered by the tax deduction received for the interest. So an ideal comparison should be between rent and only the interest component of the mortgage.

Flexibility & Duration

Renting provides you the greatest flexibility to move. You can stay in short term rental and move as frequently as needed. If you buy a home and want to move, selling is going to be long process with great overhead.

Financial Freedom

Once you pay off your mortgage, only your property tax, repairs & maintenance remains. The biggest benefit of financial freedom is time. No amount of money can buy you time. Reverse mortgage is another great option to live off your equity. So you are one step closer to your financial freedom.

The decision of buying a home or renting varies depending on both financial and emotional considerations of the individual person. Buying a home gives a lot of tax benefits, financial freedom once you pay off mortgage. Paying