What is the total

you can spend on a

home?
$430,832
Assume you need to have 20% of
that price to put downhow
much do you need?
$8!,"!!#40
$losin% costs are fees you
have to pay to %et a loan#
&hey are 2'(% of the price of
the home# )ow much do you
need?
(%' 2",(4"#!0
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
BUYING A HOME
There are 9 steps to buying a home. Use this packet to go through the entire process. You will
also be given another sheet with your personal financial information on it in order to help you
through the process.
Step 1: Figure out how much you can aor!"
Go to www.financialcalculators.com. ind the !ortgage "alculators section. "hoose the #ow
!uch #ome "an $ %fford& "alculator.
'croll down to the link( #ow much home can you afford. $nput the necessary numbers from
your given situation.
)ook for this in the results(

Yearly Gross Income
Set to 5%
Set to !
"eave all at !
#on$t change these%
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
Go back to financialcalculators.com. "lick on 'hould $ *ent or +uy a #ome& calculator. $nput
your current rent. $nput the purchase price of home from the first calculator. You have a ,-.
down payment. Your loan will be for /- years at 0.. $nput the number of years you plan to stay
in home.
#ow much will you save 1or not2 by buying the home over the years you will live there&
$ will save 3945609 to buy a home.
Step #: $now Your %ight&"
%ll borrowers have rights when getting a home loan. You should ask 7uestions about the loan5
and reali8e that you can shop around for a home loan. 9o a Google search to find the current
%:* for(
/- year fi;ed mortgage& <.-=<. %:*
>0 year fi;ed mortgage& /.>9. %:*
?hat website did you use&
htt&'(()))%*illo)%com(mortgage+rates(!+year+,i-e.(/re0uest123+4TY5667
Step ': Shop or a (oan
Go to www"hu!"go)*+uying" "lick on the )ooking for the best mortgage( shop5 compare5 negotiate
link. @pen the :9 and look through the materials 1and especially the glossary) to answer the 7uestions
below(
?hich type of loan is better( i;edArate or %dBustableArate loans& ?hy&
i;edArate because the amount of money you have to pay doesnCt fluctuate. ?ith an adBustableA rate
when interest rates raise generally so does the adBustableArate payment.
?hat is :!$ and when is it re7uired&
$t is re7uired generally when the down payment is less than ,-..This protects the lender against a loss if
a borrower defaults on the loan.
The money held in escrow is used to pay for( $t is used for a homeowner to pay for ta;es and
insurance.
Step ,: (earn a+out Home +uying -rogram&
Dothing to do in this stepEBust be aware that there are programs available to help those that
cannot afford a house on their own. or e;ample5 #abitat for #umanity will use volunteers to
build a house for a needy family5 if the family 7ualifies.
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
Step .: Shop or a Home
irst you should choose a real estate agent. %s a first time homebuyer5 you should DFGF* buy without
an e;perienced agent. :lus5 it costs you D@T#$DGH *eal Fstate agents are paid by the sellers of a
home5 and first time home buyers are not selling their homes5 so they pay nothingH
There is nothing for you to do for this step5 Bust remember this for your futureH
De;t you make a wish list. ill in the wish list on the following , pages.
The Basics:
"# What part of town *or country+ do you want to live in?
,ashville, &ennessee
2# What price ran%e? ,o less than $200,000 -ut no more than? $(00,000
2# Are schools a factor and, if so, what do you need to ta.e into consideration *e#%# want
speci/c school system, want .ids to -e a-le to wal. to school, etc+?
0es, want a %ood school in a nice area#
4# 1o you want an older home or newer home *less than ( years old+? ,ewer
(# What .ind of houses would you -e willin% to see? 2ar. all that apply#
3ne 4tory 2 story 4plit 5oyer 4plit level
&ownhouse6condo 2o-ile home
!# What style of house appeals to you most?
$ontemporary &raditional 4outhwestern $olonial
,o 7reference
8# )ow much renovation would you -e willin% to do? A lot A little ,one
8# 1o you have to -e close to pu-lic transportation? 0es ,o
9# 1o you have any physical needs that must -e met, such as wheelchair access? ,o
"0# 1o you have any animals that will re:uire special facilities? ;f so, what? 0es, a -ac.yard
for do%s
""# The lot 2ust )ave Would <i.e to have
<ar%er than " acre
4maller than " acre
5enced'in yard
=ara%e
$arport
7atio6dec.
7ool
)ot &u-64pa
>?tra 7ar.in%
3ut-uildin%s
4pecial view
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
The Interior
"2# )ow many -edrooms must you have? 3 -edrooms Would you li.e to have? 4
-edrooms
"3# )ow many -athrooms do you want? 3 at least
"4# )ow -i% would you li.e your house to -e *s:uare feet+ ,o less than@ ",800
,ot more than@ no limit
"(# What features do you want to have in your house?
2ust )ave Would li.e to have
Air $onditionin%
$arpet
$eramic tile
)ardwood Aoors
>at'in Bitchen
5ormal 1inin% Coom
5amily Coom
=reat room
1en or li-rary
Dasement
<aundry Coom
5ireplace
Wor.shop
,o ;nterior 4teps
Ein'lawF apartment
4pa in -athroom
<ots of windows
"!# Are there any other special features or needs that you must consider when youGre
loo.in% for a home? ; would li.e to have a spacious -ac.yard that is fenced in#
%fter filling out your wish list5 you get to go shopping for a house. You would normally go visit many
homes with your agent to find the best home to fit your needs. ?e are going to do this online instead.
Use the following websites to find homes close to your ma;imum price from page >.
www.iowarealty.com AAThis one usually has the most informationH
www.8illow.com
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
www.coldwellbanker.com
http@66www#neiltimmins#com6
www#rema?#com
&here are many others, and you can use any we-sites that have home listin%s#
5ind the top 3 homes that meet as many of your wish list items as possi-le A,1 are
close to your 2a? 4ales 7rice# &hen /ll out the followin% ta-le@
Hou&e 1 Hou&e # Hou&e '
)ocation 1address2 >6-/ !cgavock :ike5
Dashville5 TD
>=4, *achel ?ay5 @ld
#ickory5 TD
<49< +rick "hurch
:ike5 Goodlettsville5
Tn
)ist :rice 3 3<,05--- 3<,959-- 3<,959--
Year +uilt ,->< >996 >990
'tyle of home( !odern single family
home
!odern single family
home
'ingle family ranch
home
I of bedrooms / bedrooms < bedrooms / bedrooms
I of full baths / bathrooms < bathrooms / bathrooms
I of J baths
I of half baths
%bove Grade '7uare
ootage
,5/06 s7 ft. <5>>4 s7. ft. /5,0> s7. ft.
)ower )evel inished '7uare
ootage
Do basement Do basement Do basement
Total inished '7uare
ootage
,5/06 s7 ft. <5>>4 s7 ft. /5,0> s7. ft.
)ot si8e 1either ' or acres2 4566< s7 ft. ./= acres =.9< acres
Garage 1how many stalls&K
attached&2
, spaces / spaces , spaces
oundation "omposition poured poured :oured
F;terior composition Ginyl sided +rick sided +rick sided
9riveway yes yes yes
I of fireplaces > > -
#eat yes yes yes
%ir "onditioner yes yes yes
Gross Ta;es 3/5<99 3/54=6 3/5<,4
'chool district 9an !ills Flementary5
$saac )itton !iddle5
'tratford "omp #igh
%ndrew Lackson
Flementary5 9upont
#adley !iddle5
!cGavock "omp #igh
Loelton Flementary5
Loelton !iddle5 ?hites
"reek "omp #igh
@ther selling points of
interest(
Anew house
Adeck for outdoor
entertainment
Ahard wood floors
Apool
Asprinkler system
Aintercom system
Abig yard 1=.< acres2
Alots of hardwood
!ap the home using Google
!aps and tell about
positivesMnegatives of location
1e;( on busy street5 close to
grocery store5 close to public
transportation5 etc.2
Aclose to schooling
Anot on a busy street
Aclose to schooling
Agood schools nearby
Anot on a busy street
Anot close to anything
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
%ssessed value of home from
:olk "ounty %ssessorCs page
1or iowaassessors.com2
3/0>54-= 3<<959-- 3</05<--
)ast date and price of home
sale from %ssessorCs page
)ast /- days N34,50>/ 3</959-- 4M,=M>< 6M9M>< 3<,959--
ind the home on
www.8illow.com to find out
how many days it has been
on the market
>,/ days 00 days ,4 days
Use www.8illow.com to find a
nearby home that has sold
recently5 is a comparable
home5 and tell me how !U"#
it sold for
'old around 3/--5---
so mine is more
e;pensive.
!ine is less e;pensive
others around sold for
30--5--- and
3=--5---.
!ine is e7ual to others
around it5 they sold for
around 3</,5---
"hoose the house from above that meets most of your wishes and is close to your !a; :rice. ?hich
one did you choose& ?hy&
$ choose the middle house because it had a lot of nice features like a pool and fit all my needs. $t also
had an e;tra bedroom and bathroom then the other two.
Step /: Ma0e an oer"
This is the part where you decide how much you should offer. You would try to determine the fair market
value of the home by looking at the comparable homes in the area5 the assessed value5 and the last
sales price. ?rite your offer here(
$ will offer 3<,,59--
Step 1: Get a home in&pection
)etCs assume your offer was accepted. +ut before you buy a house5 you should always pay to have it
inspected. Go back to www.hud.govMbuying website. Under 'tep 45 "lick on the link or Your
:rotection Get a #ome $nspection.
?hy should you get a home inspection&
$t gives you detailed information about the house to ensure you are not getting a bad deal or ripped off.
They evaluate the physical condition5 structure5 construction5 and mechanical systems5 identify what
needs to be repaired or replaced5 estimates the remaining life of maBor systems5 e7uipment5 structure
and finishes.
"lick on the >- Ouestions to %sk a #ome $nspector link.
#ow much does a typical home inspection cost&
3/--A 30--
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
*emember5 if the inspector finds a maBor problem5 you have only lost that amount of money5 and you can
back out of your offer to buy the home.
Step 2: Shop or Homeowner& In&urance
Go back to hud.govMbuying. "lick on the link >, ?ays to )ower Your #omeowners $nsurance. F;plain
what each of the items below mean(
'hop %round( check consumer guides5 insurance agents5 companies and online insurance 7uote
services. This helps with knowing the price range things are actually worth.
*aise Your 9eductible( The higher the deductible the more money you can save on your premiums.
?hen YouCre buying a home5 consider the cost of homeowners insurance( "heck the ")UF report of the
home you think of buying this contains the insurance claim history that can help you Budge some of the
problems it might have.
Step 3: Sign paper&
Go back to the first webpage to find this info( This is called the closing or settlement. This is when
you actually become the owner of the house. @h5 and you have to sign a T@D of paperworkH
Home Owner&hip
Dow5 you get to live in the houseH That also means you have to make the monthly mortgage payments.
Use the mortgage calculator online at www.financialcalculators.com to figure up your monthly payments.
%ssume your offer was accepted.
Take your offer minus your down payment 1on page >2 to figure out the loan amount.
You are getting 0. interest on your loan.
%ssume you are paying it off over /- years with yearly amorti8ation.
YF'5 #ave the calculator estimate the ta;es5 insurance5 and private mortgage insurance.
?#%T $' Y@U* T@T%) !@DT#)Y :%Y!FDT5 including ta;es5 insurance5 P :!$& 3,5,=0.6-
Dow5 take your Yearly Gross $ncome 1given on card at beginning of this activitiy2 and multiply it by .40
1this is assuming ,0. is taken out for ta;es2.
I live in Tennessee My current career is Oncologist My current salary is $8,466 monthly
Dow divide that number by >, months to find out your monthly net income. 3=5/<9.66
?hat percentage is your payment of your monthly net income& 1hint( take monthly payment divided by
monthly net income2 ,<.
9o you think this is a reasonable percentage& F;plain.
Yes5 $ think this is a reasonable percentage. The average amount you can spend on a house is up to
/-. and $ spent less than that.