Do Your 2023 New Year’s Resolutions Include A New Brooklyn Home?

Homebuyers dreaming of a new Brooklyn Home

Are you making resolutions that include a new Brooklyn home for 2023? If that is on your list of resolutions, you may wonder where to start. 

As a homebuyer, there are several steps to take before your begin to look at homes:

Talk With A Lender

It is always important to speak with a lender first to determine the amount you will be able to borrow. Interest rates have changed and may affect the price of the new Brooklyn home you can afford. Learn what you can do to beat high-interest rates in this previous blog post.

The lender will look at your credit report to determine the amount of a mortgage you qualify to borrow. If there are any credit issues, the lender can direct you to a credit repair agency that can help you boost your credit score to buy a house within a few months.

Having a pre-approval letter before you start looking will help you in several different ways:

  • You will know your most comfortable price range and target your monthly payments.
  • The seller will require a pre-approval letter to be submitted with your offer so that they know you are qualified to purchase their home before they agree to accept your offer.
  • You will not delay submitting your offer by having to obtain your pre-approval after you find the perfect home.

What information do you need to have when contacting a lender for pre-approval?

  • Income verification. How you get paid will determine what information you need to provide the lender. 
    • W-2 employee – You will need copies of your W-2 forms and two most recent payroll stubs. 
    • Self-employed – You will need a year-to-date profit and loss statement and two years of tax records, including 1099s you used to report income. Self-employed includes sole proprietors, partnerships, and S-corporations.
  • Assets. You will need to provide bank, retirement, and investment account statements.
  • Debts. You will need a list of all your monthly payments for student loans, auto loans, personal loans, mortgages, and credit cards.
  • Other information. It may be necessary to show any rental income you receive, a divorce decree which would address child support and alimony along with property settlements, and down payment gift letters if you will be obtaining your down payment from a parent or family member.

The lender will ask for verification of any other items needed throughout the process. First, you must have a paper trail of sources for the down payment and closing costs. If the lender finds any large deposits in your bank statements, they may request an explanation of its origins. Finally, you will need to notify your lender of any changes in your financial position.

Getting pre-approval from your lender in advance is the first and most important step in the home-buying process.

Find a Good Real Estate Agent

When you are ready to buy a new Brooklyn home, you need to find the right agent to guide you through the buying process, whether you are a first-time homebuyer, a move-up buyer, or a downsizing buyer. 

Interview several agents if you do not know one with a good track record and local reputation. Questions you may want to ask an agent during an interview include:

  • How long have you been an active real estate agent?
  • Do you work full-time in your real estate business?
  • How many homes do you sell per year?
  • How do you stay current on the local real estate market and trends?
  • Do you have references available?
  • Do I have to sign a contract, and can I cancel if I am unsatisfied?
  • How do you communicate with your clients and set realistic expectations?

The local real estate market is changing, and you need someone in your corner who is knowledgeable and can help you negotiate the best deal possible. You also want someone realistic about the market. Hiring a Buyer’s Agent does not typically cost the buyer, as the seller pays the commission. 

A buyer’s agent is responsible for the following:

  • Assessing your needs. The buyer’s agent will ask you about your requirements. You need 3 bedrooms, but you want 4 bedrooms. This information will help your agent research properties that suit your desires.
  • Explaining the buying process. The buying process can be complicated. Every home sale is different. An experienced buyer’s agent can handle unique situations to help you buy your Brooklyn home. 
  • Showing you properties. Your agent will find the properties, make appointments, and walk you through the homes. This is where an experienced local agent is most valuable to help point out the positive features and potential issues they may see.
  • Writing up and submitting your offer. Your buyer’s agent can advise you on pricing and how to structure an appealing offer. They will then submit the offer and communicate with the seller’s agent to begin negotiations.
  • Monitoring the closing process. After your offer is accepted, your agent will coordinate with all parties until the closing is final.

Your buyer’s agent is your advocate. They will answer your questions and guide you through the entire process to help you buy your new Brooklyn home.

A common misconception is that working with the seller’s agent will get you a better deal. The Seller’s agent is working on the seller’s behalf and is contractually obligated to do so. Do yourself a favor and find the right buyer’s agent.

Narrow Your Search Criteria

You most likely know where you would like to buy your new Brooklyn home. However, you may be looking for a particular school or proximity to work. Focus on your top area first, and then move out if you can not find the right home.

Make a list of the items you must have in your new home, and be sure to discuss those items with your real estate agent. Think of the things that would be a “deal-breaker” for you and discuss that with your real estate agent. The more your agent knows about your needs, the better they can zoom in on the suitable homes for you. A resourceful real estate agent can guide you to the properties that meet your criteria. 

Try to get input from others who live in the areas you are considering for the pros and cons they can offer. If you don’t know anyone living in the neighborhood, check out some online forums that can provide insight.

It is a good idea to visit the community at different times of the day to get a feel for what is happening in the neighborhood.

Conduct Inspections

Unless you have a thorough knowledge of house construction and components, I do not recommend waiving the inspections when you buy a house. Inspections are an important part of the home-buying process. 

A home inspector must have an active license in the State of New York. You can find answers to frequently asked questions about New York licensing for inspectors here.

The seller will disclose what they know about the property. However, it isn’t uncommon for the home inspector to find things that the seller didn’t know.

The home inspector will check the home’s major components, starting on the outside. First, they will look at the foundation and the roof for any defects. Then they will begin their interior inspection in the home’s basement. Finally, they will check the electrical, heating, air conditioning, and plumbing systems. In addition, they will also check windows, doors, and flooring.

Ask the inspector what they will and will not check before scheduling your inspection. If you notice something during your home tour, you should ask the inspector to look closely during his inspection.

You will also want to have a pest inspection to ensure there are no wood-boring insects, such as termites, that would be causing damage to the home. In addition, some types of financing will require a clear pest inspection report.

When you initially look at a home, you look more from an emotional point of view. You are picturing yourself and your family and friends in the spaces. You may not be looking at the home with a critical eye. Therefore, having a third party examine the property is valuable to learn if any safety or major ticket items need repairs.

Loan Application

After you accept a home offer, you will need to make a formal mortgage application. If you use the same lender who provided you with the pre-approval, they may have all your information. Notify them when you have an accepted offer on a home and find out what additional information they require.

Once the formal loan application is in process and inspections are negotiated, you can prepare for closing day!

The process of buying a new Brooklyn home can seem daunting. However, the key to a successful home search and negotiation is to have the right team in your corner. There are many people involved. Check out this blog post to learn more about each party.

Contact me, Charles D’Alessandro, your Brooklyn Real Estate Agent with Fillmore Real Estate, to help you make your resolution for a new Brooklyn home come true. As a Brooklyn real estate agent with over 35 years of experience, I have been assisting Brooklyn Homebuyers with advice and resources. Reach me by phone at (718) 253-9500 ext. 1901 or by email at [email protected].

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