So you want to buy a home in 2012?


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It's a new year, with fresh, new perspectives. Maybe you've been thinking of buying a home—first time or otherwise—and have decided this is the time to do it. Well, I've got news: Buying a home doesn't just happen on impulse, like buying a new pair of shoes. You've got to prep for it, so when the right home comes along, the process is relatively painless for all involved.

I talked to Honolulu Board of Realtors President Joyce Nakamura to get some tips on this prep process:

1. Start with a Realtor. Don't know any?  Ask for some referrals from friends or family.
If you're a buyer, remember, buyers don't pay the agent's commissions, the seller does, so you're not going to shell out any money except what you need to buy the home. "Working with a Realtor will simplify the search process. They can organize your viewing options and educate you about the area you are interested in," Nakamura explains.

2. Check your credit. Don't wait until you're in the middle of the buying process to check your credit. Catch and correct score-lowering errors and other derogatory items early. Recent studies have revealed that a record number of real estate transactions are falling out of escrow, and that credit issues are a leading cause of these dead deals.

3. Get pre-qualified or, better yet, pre-approved with a lender. "Your Realtor can help you with this process," Nakamura says. "There are programs that your Realtor can assist you with that may not be well publicized."

When you go through a pre-approval process, the lender can tell you exactly how much home you can afford—and you may be surprised. In addition, if you're pre-approved, when you're ready to buy your home you can whip out a letter that the lender has prepared to help shoot you to the top of the list of interested buyers. It's always better if the seller knows you're serious and have legitimate documentation of your finances.

4. Do your research: Go to open houses, browse the internet, and go over CMAs with your realtor so you know what the price ranges are in different neighborhoods. You'll be wasting time—yours and your realtor's—if you flounder around the island trying to figure out what you really want. If all the planets align, you can get a home in the price range you want in the neighborhood you like with the square footage you can live with. But chances are, you may need to make some compromises.

5.  Purge. If you hold a garage sale, you can get rid of stuff that will bog you down when you move, and can add to your cash savings at the same time.

"It's a great time to buy. Interest rates are still very low, however, we don't know how long this will last. So start prepping now!" Nakamura adds.

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