Home Buying for Dummies

Perhaps the only way to get one up on sellers in the nation's hot housing market is to read "Home Buying For Dummies" (IDG Books, $16.99) -- especially if sellers are reading "House Selling For Dummies" (IDG Books, $$16.99).

Before you open the first in a trio of residential real estate books by San Francisco broker Ray Brown and East Coast finance counselor Eric Tyson (they also penned "Mortgages For Dummies") you begin to get an idea of the detail you can expect to find within.

The title for sellers is "House Selling," to convey the air of detachment sellers should exercise, but for buyers, it's "Home Buying" -- it's not just a house, but a home.

Not a publisher's oversight, the subtle title distinctions go to the heart of what's inside. In "Home Buying" it's detailed detail that begins with the authors' holistic approach to what could be the largest and most expensive transaction you'll ever make.

Never assuming you are shopping for a home, the guide first teaches you the economics of buying a home, housing market ups and downs and affordability issues, all to look at home buying within the context of your own personal financial needs and goals.

Unlike so many other realty books, this one does not spoon feed you the time-worn rent-vs-buy equation that inevitably adds up to "buy a home, or buy a home."

"A lot of people ask you what you can afford to spend on housing just based on income, ignoring the fact that you might be saving for retirement or investing for other things. Home buying should be in the context of your overall financial situation,'' said Tyson, who's also penned a small library of "Dummies" personal finance guides.

Not until after the authors' deft handling of the mortgage maze in Chapters 5 and 6 do you begin to learn home buying strategy. For hot or cold markets, the authors had the foresight to include strategies for finding a home, picking a real estate team, determining a home's worth, negotiating, inspections, insurance and escrow.

From "To Buy or Not to Buy, That Is The Question" to "It Ain't Over Till the Weight-Challenged Escrow Officer Sings," the home buying book is far ahead of its competitors, but it doesn't stop there.

It's all peppered with "Dummies'" trademark icons (string-tied finger reminders, bullseye tips, ticking-bomb warnings, shark-fin caveats, magnifying-glass investigators and a raised-finger geek making technical point), wisecracks and gray-boxed anecdotes.

The publisher's format (responsible for selling tens of millions of books) is a throwback to the early "Dummies" days when the books were primarily designed to teach technophobes computing.

"Home Buying" also includes a glossary of well-defined real estate terms and another "Dummies" staple -- "The Part of Tens," a "Dummies" feature that imparts information in chunks of 10.

Among them is a list that indicates buying a home doesn't necessarily stop when escrow closes.

Here's "Ten Financial 'Musts' After You Buy."

• Spending, saving. Don't give in to the urge to spend all your money on furnishings and improvements. Keep you financial goals in sight and sock away savings.
  
  
• Rebuild emergency savings. If you've dipped into reserve funds to buy a home, put back that buffer to protect you from unexpected events.
  
  
• Automate your mortgage payments. Late payments can cost you. Consider automatic checking account deductions to pay your mortgage.
  
  
• Keep good records. Receipts and related documents will be necessary for your tax returns.
  
  
• Ignore mortgage insurance come-ons. Mortgage insurance polices are often over priced for the same, cheaper coverage you can get from a term life policy.
  
  
• Ignore fast payoff come-ons. You can make extra payments on your mortgage to pay it off early without paying for someone to handle your payments. Also, you could invest the extra money for a return greater than the savings you expect from an early pay off. Do the math.
  
  
• Ignore homesteading come-ons. Homesteading protects your home asset from creditors should you get into financial trouble. Your county recorder has the forms you can file for a nominal charge. File before it's necessary, however, and you could send the wrong signals to your creditors.
  
  
• Appeal tax assessments. If your home value drops, you could be eligible for reduced property taxes. Appeal directly to the county assessor at little, if any cost.
  
  
• Refinance if rates fall. A no-brainer. You'll save money on a cheaper interest rate.
  
  
• Smell the roses. You've just completed what's likely the largest purchase you'll ever make. Take a break from fixing up, furnishing and fretting about what else you need. Own your home, but don't let it own you.