As the events of the last few years in the real estate industry show, people forget about the tremendous financial responsibility of purchasing a home at their peril. Here are a few tips for dealing with the dollar signs so that you can take down that “for sale” sign on your new home.

Get pre-approved. Sub-primes may be history, but you’ll probably still be shown homes you can’t actually afford. By getting pre-approved as a buyer, you can save yourself the grief of looking at houses you can’t afford. You can also put yourself in a better position to make a serious offer when you do find the right house. Unlike pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history. By doing a thorough analysis of your actual spending power, you’ll be less likely to get in over your head.

Choose your mortgage carefully. Used to be the emphasis when it came to mortgages was on paying them off as soon as possible. Today, the debt the average person will accumulate due to credit cards, student loans, etc. means it’s better to opt for the 30-year mortgage instead of the 15-year. This way, you have a lower monthly payment, with the option of paying an additional principal when money is good. Additionally, when picking a mortgage, you usually have the option of paying additional points (a portion of the interest that you pay at closing) in exchange for a lower interest rate. If you plan to stay in the house for a long time—and given the current real estate market, you should—taking the points will save you money.

Do your homework before bidding. Before you make an offer on a home, do some research on the sales trends of similar homes in the neighborhood with sites like Zillow. Consider especially sales of similar homes in the last three months. For instance, if homes have recently sold for 5 percent less than the asking price, your opening bid should probably be about 8 to 10 percent lower than what the seller is asking.

Leonard is Certified GREEN by the National Association of Realtors and a member of Build It Green. His team advise clients on how to make their home more energy efficient and utilize solar in homes.Houses that incorporate all of the above elements of energy efficiency have many advantages. They feel more comfortable because the additional insulation keeps the interior wall at a more comfortable and stable temperature. The indoor humidity is also better controlled, and drafts are reduced. A tightly sealed air/vapor retarder reduces the likelihood of moisture and air seeping through the walls. They are also very quiet because the extra insulation and tight construction helps to keep exterior noise out better. In the end, your energy-efficient house will provide you with superior comfort and lower operating costs, not to mention a higher real estate market value.

As a broker/consultant/ private money lender with past experience in appraising and lending, Leonard has been involved in hundreds of real estate transactions and knows how to close real estate transactions. Additionally, He is uniquely knowledgeable in FHA 203K financing; a loan program which provides funds for buyers to purchase a property and make improvements with one loan…thus reducing the out of pocket cash for buyers.

For more details on our products and services, please feel free to visit us at 203K Consultant, HUD Consultant, Renovation Consultant, buy & remodel consulting & buy & renovate consulting