The first thing someone who decides they want to buy real estate is eager to do is search for homes, drive by homes, tour the interiors of homes, compare homes, etc. Usually the last thing they want to do is the homework involved in qualifying for a mortgage and understanding the legal forms they will encounter during the process. In recent years the blizzard of new laws and state and federally mandated forms has escalated to the point that the amount of homework which any buyer should do is going to require considerable time and effort. Make sure you contact one of our agents to get a buyers package which will include most of these forms so that you can do your homework without feeling rushed or pressured at a critical moment during your real estate transaction.

Some of the newer forms:

• Agency Disclosure Statement (State of Michigan mandated form)
• Sellers Disclosure Statement (State of Michigan mandated form)
• For unplatted homes or land Notice to Assessor regarding future rights to division of property.
• Lead Based Paint Disclosure (Federally Mandated forms & booklet)

This Buyer's Package will also include purchase agreements, addendum's, etc. for your review.

The next part of your homework is to qualify for a mortgage. How much house can you afford?

Most people have a general idea of how much they feel comfortable spending. It's equally important how much the lender calculates you can afford.

• Evaluate your financial situation as the lenders do. Typically, your total monthly housing costs (PITI) should not exceed 28 percent of your gross monthly income. Or, housing costs plus any outstanding monthly long-term debt should not exceed 36 percent of gross monthly income.
• Ask how your lender determines the total monthly housing cost figure. It usually includes your mortgage principal and interest payments, property taxes and hazard insurance (PITI).
• Determine how much your financial institution is willing to lend you. Call on your sales associate for help during the prequalification process.
• Know how much you can afford in monthly payments. Lenders factor in sales price and down payment, but place more importance on how much you can handle monthly.

Now that you have reviewed the forms in your buyer's package and been prequalified for a mortgage the last part of your home work is to establish a criteria for selecting homes and obtain information about houses and neighborhoods to help you make decisions. This web page will help you accomplish this.

Next you'll want to define your needs, tastes and preferences for your new home. By discussing this now, you'll save plenty of time in the house-hunting process.

• Describe the style of house you like, whether it be two-story, contemporary, ranch or something else.
• List your priorities in home features, such as a two- or three-car garage; gourmet kitchen; a family room or a formal dining room.
• Think about your lifestyle. If you don't like yard work, ask your sales associate to show you condominiums, townhouses or garden homes with smaller yards.

Bricks and boards may determine the cost of a home, but a neighborhood determines value.

• Consider the identity of the neighborhood. The overall impression given by an area is key to its value.
• Drive through and around the neighborhood. Value is enhanced by other well-maintained properties. Conversely, be cautious of areas with unkempt yards and homes, and businesses mixed in with residences.
• Ask your sales associate about the property tax assessment in the area, including any special assessments or pending bond issues.
• Pay attention to neighborhood zoning. Good residential communities are zoned to keep out commercial and industrial users. Ask about other regulations in the neighborhood, such as on street parking. Find out if this area is governed by any covenants.
List which community services are important to you. Do you want city water and sewer or is well and septic alright with you?

Now that you have your homework done you are ready to pick the agency status under which you want to work with your agent, sign the state mandated Agency Disclosure Statement, and then have your agent make showing appointments for homes you have selected and then hit the road!

When you arrive at each home ask your agent to give you the data sheet and the Seller's Disclosure Statement so that you may refer to them as you view the home.

When you find the perfect house, your sales associate will take you through a step-by-step process to make the purchase. You know the seller's asking price, now it's your turn to make some important decisions.

• Decide how much you should offer. Consider factors such as the home's length of time on the market, reasonableness of price, availability of financing and other costs.
• Know what happens to your earnest money. If you buy the house, it is applied to the down payment or closing costs. If you fail to buy the house after the seller has accepted your offer, he or she may have the right to keep this deposit.
• Require the seller to do a title search to prove the title is clear. The title should show no substantial claims or liens against the property. The type of proof varies by area, and your sales associate can tell you which kind is used where you live.
• Decide what conditions you want to place on buying the house. Your purchase may be made contingent on obtaining financing, a building inspector's satisfactory report, a well & septic inspection, a lead based paint inspection and/or the addition of a home warranty paid by either party.
• Spell out what you're buying in the contract. Common items to be specified include appliances, light fixtures, shades and drapes, storm windows, and flowers, shrubs and trees.
• Determine what special provisions should be included, such as for property taxes, insurance costs and utility bills. Read all the small print carefully.
• Your sales associate will take the offer to the seller or seller's agent. The seller will either accept, reject or counter your offer with changes in some of the terms. You may either sign or counteroffer at this point.

Sign the document when you both agree to the terms; it becomes a valid contract, and your sales associate will help you all the way through to a closing.