Real Estate Information Archive


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Top 10 Myths That Trip Up First-Time Home Buyers

by Lorna Calder

If you’re thinking about buying a home, you’ve probably received your share of advice from family and friends. Add to that the constant stream of TV shows, news segments, and social media posts that over-simplify the home buying process for easy entertainment.

With so much information to sift through, it can be tough to distinguish fact from fiction. That’s why we’re revealing the truth behind some of the most common home buyer myths and misconceptions.

Buying a home is a big decision, but it doesn’t have to be a scary one. If you arm yourself with knowledge and a qualified team of support professionals, you’ll be well equipped to make the right choices for your family and financial future.




Myth #1: You need a 20% down payment.

Plenty of buyers are purchasing homes with down payments that are much less than 20% of the total cost of the property. Today, you can buy a home with as little as 3-5% down.

There are multiple programs out there that allow you to have a lower down payment, and a lender or mortgage broker can talk you through which option is the best for you. Since you’re putting less money down, you’re a riskier borrower to your lender than people who put down a full 20%. Because of this, you will most likely need to pay mortgage insurance as part of your monthly payment.

Myth #2: Real estate agents are expensive.

Your agent is with you every step of the way throughout your home buying journey, and he or she spends countless hours working on your behalf. It sounds like having an agent is expensive, right? Well, not for you. Buyers usually don’t pay a real estate agent’s commission. Your agent’s fee is paid for at closing by the seller of the home you’re buying.1 The seller knows to factor this cost into the property’s total purchase price.

Myth #3: Don’t call a real estate agent until you're ready to buy.

The earlier you bring in an agent to help with the purchasing process, the better. Even if you’re in the very early stages of casually browsing Zillow, a real estate professional can be a huge help.

They can create a search for you in the Multiple Listing Service (MLS), so you get notifications for every house that meets your criteria as soon as it hits the market. The MLS is typically more up-to-date than popular home search sites like Zillow and Trulia. Setting up a search a few months before you’re considering buying gives you a good idea of what’s out there in your town that’s in your budget. Reviewing the MLS and speaking with an agent as soon as possible can help you set realistic expectations for when you actually start the house hunting process.

Myth #4: Fixer-uppers are more budget friendly.

We’ve all watched the shows on HGTV that encourage people to go after fixer-uppers because they’re more affordable and allow buyers to eventually renovate the home to include everything on their wishlist. But, this isn’t always the case.

Sometimes, homes that need a lot of work also require a lot of money. Big renovations, like add-ons, a total kitchen remodel, or installing a pool, take a lot longer than it looks on TV. If you’re really interested in a fixer-upper, ask your agent to show you a mix of newer homes and older homes. If you fall in love with an older home that needs a lot of work, get some quotes from contractors before you buy so you know the real cost of the renovations and see if you can work them into your budget.

Myth #5: Your only upfront cost is your down payment.

Your down payment is big, but it isn’t the only money you’ll spend during the home buying process. At closing, you’ll pay your down payment, but you’ll also bring closing costs to the table. Closing costs are typically anywhere from 2-4% of the total purchase price of the home.2 This amount includes the cost for items like homeowners insurance, title fees, and more.

You’ll also need to pay for an inspection before closing, which usually costs a few hundred dollars. This price will be higher or lower based on the size of your new property. Your lender will also require an appraisal. An appraiser will come in and inspect the home to determine how much it’s worth. Depending on your lender, you may have to pay this when the appraisal is conducted or it might be rolled into your closing costs.

Myth #6: You need a high credit score to buy a house.

You don’t need perfect credit to buy the perfect home. There are loans out there that buyers with lower credit scores can qualify for. These are good options for people who have had credit issues in the past, but some of them come with additional fees you will need to pay. Speak to a few local lenders or mortgage brokers to talk through which options might be best for you.

Myth #7: You can't qualify for a mortgage if you're still paying off student loans.

While some buyers may feel more comfortable paying off their existing debts before taking the leap into homeownership, it’s not a requirement. When you’re applying for a mortgage, the lender takes a close look at your debt-to-income ratio.3 If you want to calculate this on your own, add up all of your monthly debt payments and divide those by your monthly income. When you’re lender does this, they’re trying to make sure that you will be able to afford your monthly mortgage payments along with your other existing payments. If your income is high enough to allow you to make all of these payments each month, having a student loan will most likely not stop you from getting a mortgage.

Myth #8: You should base your budget on what your lender approves.

How much house you qualify for and how much you can afford are two totally different numbers. When you prequalify for a mortgage, your lender will look at your income, debt, assets, credit score, and financial history to determine how much money you might qualify for.4 For some people, this number might be much higher than you thought because lenders tend to approve for the highest amount they think you can afford. But that doesn’t mean that’s how much you should borrow.

Instead, figure out how much house you can actually afford. An online mortgage calculator can be a good first step in determining this number. We recommend thinking about what you want your monthly payment to be as a starting point. And remember to include your principal, interest, taxes, and, insurance. You should also think about ownership expenses that aren’t part of your monthly payment, like HOA dues and maintenance.

Myth #9: It's all about location.

You’ve heard the phrase. Location, location, location is basically the real estate industry’s motto, but we’ll let you in on a little known secret: It’s not always true. Yes, location is great to consider when it comes to school districts and commute times, but you also need to think about how the home will function for you and/or your family’s lifestyle. If a family of five is choosing between a one bedroom condo in the bustling city center and a 4-bedroom home out in the suburbs, the latter is probably the best, most functional choice for them. Also, by buying in a less sought after neighborhood, your property taxes will most likely be much lower!

Obviously, you might still want to choose an area with great resale potential, and this is something that your agent can speak to you about. They’re an expert in your city and are constantly monitoring buying and selling trends.

Myth #10: If you look hard enough, you'll find a home that checks every box on your wishlist.

You’ve seen that famous house hunting show. And while we have our suspicions about how real it is, the one thing they get right is that almost every buyer needs to compromise on something. Yes, the perfect house that meets every item on your wishlist is probably out there, but it’s also probably double or triple your budget.

A long wishlist can be a great starting point for figuring out what you want and don’t want, but we recommend narrowing that wishlist down to the top five things that are important to you in order of priority. We also recommend noting on your wishlist what your absolute deal breakers are, like “must have a yard for our dog,” and noting what you can live without, like “heated bathroom floors.”

This is a great list to discuss when you first start talking to an agent. A good real estate agent will be able to look at your list and find properties that might work for you. By coming to that first meeting with realistic expectations and knowledge about home buying rather than a bunch of myths heard here and there, you’ll be able to start the process off on the right foot and be in your new house in no time.


Whether you’re a first-time buyer or a seasoned homeowner, there’s no reason to go through the home buying process without an advocate on your side. We’re here to answer your questions and do the hard work for you, so you can spend your time dreaming about your new home. Call us today to schedule a free, no-obligation consultation.

Get a FREE copy of our Home Buyer’s Guide to Getting Mortgage Ready

Now that we’ve cleared up these common homebuyer myths, find out if you know the steps you should take to prepare financially before you apply for a mortgage. Contact us to request a complimentary copy of our “Home Buyer’s Guide to Getting Mortgage Ready.”


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You Don't Need Luck to Find Your Dream Home

by Lorna Calder

You don't need luck to find your Dream Home! Let The Lorna Calder Team guide you through the process step by step!

Step One:

Give us a call today! 281-361-2280

Step Two:

Our team of professionals can help you with the first steps of getting pre-approved with a reputable mortgage lender.

Step Three:

We can then start the search for your dream home in Kingwood, Humble, Atascocita and and Houston area.

Step Four:

We will handle all the paperwork and use our proven negotiation techniques to help get you the best deal for the perfect home.

Step Five:

You get to move in! Its that easy. We simplify the process so you don't have to sweat the small stuff.

Read our past clients' reviews and see what they had to say about us here.

Want to maintain that Good Credit?

by Lorna Calder

You can make sure that when you get your credit in good shape that it STAYS THERE!

Here are a few ways to do just that!

Maintain low balances on your credit cards and revolving lines of credit.

Once you’ve paid them down, keep the balances low by using them only for emergencies.  If the balance is currently high on one or more cards or credit lines, begin paying them down, starting with the card or credit line with the highest interest rate first.


Set up automatic bill pay.

Many creditors and utility companies make it easy to pay your bills on time by sending reminders before the payment is due. Additionally, setting up an automatic payment will ensure the bill is paid on time.


Keep rate shopping within a 30-day window of time. 

If you’re thinking of taking out a loan to buy a car or a home, limit your rate search to a small timeframe so the inquiries will likely be treated as a single one. The more inquiries into your credit, the more likely they’ll count against your score.


Reconsider closing accounts.

Even if you don’t use a line of credit anymore, it may not be a good idea to close it. Closing several accounts at once may raise red flags and impact your credit. Instead, leave the balance at zero and try not to use it. 


Be responsible.

It takes time to build great credit; it also takes time to rebuild your credit once it’s damaged. Once you’ve earned a great credit score, continue good financial habits to maintain it.


The difference between "Good Credit" and "Excellent Credit"


What is a "Good" credit score?

Its usually lenders who decide what they would consider as good credit, the credit tier generally breaks down as follows:


What is the dividing factor between people with "Good" credit and people with "excellent" credit?

Although people with excellent credit have more open revolving credit accounts, they don’t actively use them  and the debt they do carry makes up a lower percentage  of their overall available credit. 



© 2017 Buffini & Company. All Rights Reserved. Used by Permission. RMMK AUGUST EREPORT S






March 2014 Houston and National Housing Newsletter

by Lorna Calder

This month’s featured video discusses the importance of using a Realtor for all of your home buying needs. Realtor's have a great deal of knowledge in the real estate market can provide all of the information you need for the property you are interested in. A Realtor can also help you determine how much home you can comfortably afford and refer you to helpful lenders.

A Realtor will always negotiate on your behalf to get you the best price for your new home and help take care of all of the closing paperwork, and closing procedures. 

There is a lot to know about owning a home.  A Realtor is always your best source of information for all your real estate needs...


If you have not reviewed my monthly Housing Trends Newsletter - you could be missing out. Everywhere I go, people are asking me about the housing market conditions - it's on everyone's mind. Staying abreast of local and national market conditions and factors that can affect the future sale or purchase of your home can make the decision process less daunting. I always tell my clients that in order to make the best decision they need to have all the information they can upfront. My Housing Trends Newsletter is just one of the tools in my arsenal to make sure you keep informed.

The March 2014 Local and National Housing Trends has just been released. This month's newsletter is packed full of local and national housing market statistics and news you need to know to stay current with today's changing housing market.

This month's housing trends issue features:

Existing-Home Sales Drop in January While Prices Continue to Grow

December Pending Home Sales Fall

Boost Your Credit Score to Buy a Home

Odd Moving Tips that Really Work

How Much Mortgage Can I Afford

Experts Predict 2014 Housing Market

2014 Remodeling Tips

You can view the newsletter here.

If you wish to receive FREE Housing Trends eNewsletter e-mailed to you monthly, click here to Subscribe.

If you are considering selling your house or buying a home and need more information, I am never too busy to help, please contact me for more information.

First Time Home Buying 101

View graphicWorking with a lot of first time home buyers, I get asked a lot of questions. Good questions. Whether you are a first time home buyer or a second time around buyer, make sure that you are well informed of the process and real estate practices in the area that you are purchasing in. Policies, procedures and contract forms vary from state to state. So make sure you keep in the know.

Other things you may want to consider should be, what is the average home price in the area that you are looking in? Why should you know this? Because you should know whether you are purchasing above or below the average price range - this can help you when you are thinking about resale... which by the way - you should be thinking about before you buy... Confused yet?

Is it better to buy a three bedroom or a four bedroom?

What features are you looking for in your home? Are you aware of what some of those features can cost in the area you are looking in ?

What is the typical cost of home improvement projects? Can you afford to update a home after you buy it? Which home improvements gibe the best return on investment?

How much does an inspection cost in the area? Why should I have one?

How much is an appraisal? Survey?

What are closing costs and how much will they be? Who pays the closing costs?

How much is homeowners insurance?

What is title insurance and why do I need it? Who pays for it?

What is an escrow account? Why do I have to have one?

Where is the best place to look for houses?

What are the Steps to Buying your First Home?

How much should I have for a down payment?

How much house can I afford?

How do I get pre-approved? What is the difference between prequalified and pre-approved? Why does it matter?

Many of these questions can be answered by having a first time home buyer consultation with a real estate agent. Looking before you leap into a contract on a home can save headache, heartache, stress and money. Asking your questions early in the process will make you feel very comfortable about what you are doing and the decisions you are making.

Make sure that you are prepared - even if it means waiting a little bit to start looking while you get your affairs sorted out and ready. You have to be in the position where as seller can look at your contract and your pre-approval letter and say yes, this buyer is Ready, Willing and Able to buy my house. You must be all three. Most prospective home buyers are ready, and they are willing, they are just not able... yet.

Ask your real estate professional a lot of questions - they should know the answers, or be able to get the answer quickly or put you in touch with someone that can. If they cannot, you should ask yourself if this is the best person to be working with. If you would like to see the full size infographic - click here.

Seems like a lot to think about and it is, but the whole process can go fairly smoothly when you are working with a Realtor. If you are thinking about purchasing a home, contact the Lorna Calder Team. Lorna and her Team have helped many first time home buyers navigate through the process to become successful home owners.

Lorna Calder is an award winning Real Estate Broker in Kingwood Texas. Lorna's past clients rate her as #1. Lorna Calder has also appeared on HGTV's House Hunters.


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