Establish A Budget

When buying a home in California's Bay Area, your first step must be to sit down and set a realistic budget based on what you can comfortably afford. Looking for a house that is beyond your means promises nothing but disappointment and future financial woe. Conversely, just because you can afford a more expensive house doesn't necessarily mean that you should buy one.

In setting your budget, be prepared to factor in the down payment and expenses associated with the transaction, including closing costs. You will also want to consider what your monthly mortgage payments will be, as well as insurance and property taxes.

Your down payment will depend on the type of loan you have. A conventional loan typically requires a substantial down payment, usually 10-20% of the purchase price; while FHA (Federal Housing Administration) and VA (Veterans Administration) loans, which are backed by the government, require a much smaller down payment — generally 3.5% for an FHA loan and as little as no down payment for a VA loan.

Closing costs vary, depending on the circumstances and conditions surrounding the purchase agreement, but usually include title and escrow fees, appraisal and inspection fees, hazard insurance, and notary fees. Additionally, they may include loan points, mortgage insurance, reserves for impounds, and up to one month's pre-paid mortgage interest.

After establishing a budget for your East Bay home purchase, the next step in the process is to get pre-approved for a loan so you can begin searching for your East Bay home with confidence. You can proceed to this next home buying step now by visiting Step #2: Get Pre-Approved: Secure Funding So You Can Shop With Confidence.

Two New Surveys Indicate Urban to Suburban Lean

There has been much talk around the possibility that Americans are feeling less enamored with the benefits of living in a large city and now may be longing for the open spaces that suburban and rural areas provide. In a recent Realtor Magazine ...

Read More

Three Ways to Win in a Bidding War

With so few houses for sale today and low mortgage rates driving buyer activity, bidding wars are becoming more common. Multiple-offer scenarios are heating up, so it's important to get pre-approved before you start your search. This way, you can ...

Read More

Why Is It so Important to Be Pre-Approved in the Homebuying Process?

You may have heard that pre-approval is a great first step in the homebuying process. But why is it so important? When looking for a home, the temptation to fall in love with a house that's outside your budget is very real. So, before you start ...

Read More

The Top Reasons People Are Moving This Year

Today, Americans are moving for a variety of different reasons. The current health crisis has truly re-shaped our lifestyles and our needs. Spending extra time where we currently live is enabling many families to re-evaluate what homeownership ...

Read More

Forbearance Numbers Are Lower than Expected

Originally, some housing industry analysts were concerned that the mortgage forbearance program (which allows families to delay payments to a later date) could lead to an increase in foreclosures when forbearances end. Some even worried that we ...

Read More