Barneveld is a small village in the county of Iowa, Wisconsin. With all the charm and friendliness of a village, the space and affordability to get a great home, and proximity to cities like Madison, it’s a great place to buy your first home and if you have such plans, raise a family.
However, even if you’re local to the area, buying a home for the first time comes with a steep learning curve if you want a successful transaction, that’s quickly done and as hassle free as possible. You’ll want expert help to ensure that all proceedings take place smoothly so that you can get on with enjoying your new life in your new home.
If you’re not from the area, you’ll need to work with people who know it intimately. These are professionals who’ll look after your interests because apart from working for you, they serve the community you’re looking to live in. Here’s the information you need at the beginning of your house hunting journey.
- A little more about Barneveld
- Getting your finances in order
- The importance of credit score
- Improving your credit score
- Have enough to cover not only eventualities, but emergencies
- How the Wisconsin Housing and Economic Development Authority (WHEDA) can help
- The right type of home
- Getting the right help
- Access to resources
- Negotiation skills
- Administration and paperwork
- Potterton Rule is Southwest Wisconsin’s finest
A little more about Barneveld, WI
When we say Barneveld enjoys being a community, we mean community. The population stands at a little over 1,200 people. However, with a population density of 653 people for every square mile, you really can have all the peace and tranquility you need. Compare this to one of the nearest cities, Madison, which has a population density of 3,319 people per square mile and you begin to get a picture of what opportunity for open land you have in Barneveld.
Tranquil, yes, but Barneveld isn’t a sleepy village. Many young families live in Barneveld, and the majority of residents own their own home. The current rate of home ownership stands at over 80%. This makes for a stable but warm and sometimes lively place to live. With a median household income of $84,000, it could not be described as affluent, but Barneveld does enjoy a considerably higher household income than the national average which stands at $62,843.
Altogether, Barneveld has much to offer people who are looking to buy their first home. And with certain financial programs, such as those offered by the Wisconsin Housing and Economic Development Authority (WHEDA), and the help of a good Realtor, that dream of owning your first home could become a reality.
Getting your finances in order
You may feel that you’re ready to buy your own home but the proof really is in your financial standing. Basically, are you in a financial position not only to get approved for a housing loan, but also to maintain payments without overextending yourself?
- The importance of credit score
If you have a good credit score, you’re mostly on the way to being accepted for a housing loan. Unfortunately, many people in their mid- to late-20s have some of the lowest credit scores for the overall demographic of the country. From age 30 onwards things somewhat improve, though credit scores don’t normally tend to reach high enough numbers until people reach 55. Ironically, teens actually have on average better credit scores than those in their 20s – but they aren’t in the market to buy their first homes.
For those at a later stage in life, looking for a second home or looking for a place to retire, a certain amount of financial stability makes it easy to get a housing loan. However, if you’re in your early to mid-30s, you need to be able to score well to get the best deal on interest rates for your loan.
The difference between having a high credit score and just about making the cut could be as wide as having to only pay 3% APR (annual percentage rate) and paying 20%. It may sound ironic that lending companies would charge a higher interest rate for people who seem less able to pay them. It all comes down to risk and whether the lending company believes you are a high risk borrower or a low risk one.
If you’ve been diligent paying off debts and general payments, and haven’t defaulted on any payments, then you’re likely to have a good credit score. A lending company will then have a much higher level of confidence in your ability to repay loans. Since you’re not seen as high risk, they can confidently offer a lower interest rate. However, if you’re deemed a higher risk, lenders will offer higher interest rates to offset the risk. Beyond this point, you could be outright disapproved of a loan.
While different lenders use different ways to measure your credit score, there are many free online credit score checks you can use to give you some idea of where you stand financially before looking for a loan.
Typically, private lenders are looking at a minimum credit score of 620 to qualify for a conventional home loan.
- Improving your credit score
The first thing to do is find out what your credit score is, so go ahead and use this link to find out.
Payment history counts for the largest factor when assessing credit score. If you have a record of paying on time and paying off debts promptly, it’ll work in your favor; student loans are included here. If you haven’t been diligent in your payments, there’s no better time than now to start fixing that. Pro tip: Consolidate all payments to one credit card and religiously pay it every month. Not only does this make it easier for you to manage payments and debts, it looks great to a lender.
Don’t put in too many applications for credit. It’s fine to make inquiries on credit as this will not affect your credit score, just don’t make multiple firm requests or applications for credit. This propensity could be seen by lenders as high-risk behavior, indicative of a lifestyle that constantly requires you to ask for credit. If you have made a fair number of requests recently for credit, it may be time to drop the habit if you’re serious about improving your credit score.
Be patient. If you need to improve your credit score, it could take a while, maybe even months before you’re in a position where you’ll see improvements. A few months of tightening up will be worth it when you get approval for a housing loan. It’ll be even more worth it, if you manage to get low interest rates on your loan.
- Have enough to cover not only eventualities, but emergencies
It’s a rule of thumb that you expect to spend 1% a year on home maintenance and repair costs. In Wisconsin, a typical house owner could expect to pay $2,699 for annual maintenance and repairs to their homes. In Barneveld, the median price for homes for sale is $236,000, so if you bought a house here, it would mean you’d have to put aside about $2,400.
However, bear in mind that as well as having home care issues to deal with, life itself can sometimes throw you a curveball. You need to have a fund that gives you some financial buffer so that in difficult times you aren’t in immediate danger of defaulting. The ability to make payment for six months without having to rely on work income, is a good safety net.
How the Wisconsin Housing and Economic Development Authority (WHEDA) can help
Something unique to Wisconsin and which may be of particular interest to first-time home buyers is WHEDA, the Wisconsin Housing and Economic Development Authority. As their name suggests, they have helped Wisconsin communities both in terms of providing affordable housing and helping businesses with their finances.
For first time buyers, Wheda has “First Mortgage and Down Payment Assistance Programs.” The use of both these programs can provide 100% of the financing required to buy a house. WHEDA can help finance your home and get you on the property ladder even if you don’t have a stellar credit score.
Availability is subject to conditions but if you’re a first-time home buyer, then WHEDA should be something you need to explore as part of your financing options.
Once you’re in a financial position to buy a house, you can then entertain thoughts about what type of house you want and match it to what you can reasonably afford. Again, for a place in Barneveld, though there will of course be variations, you’re looking at median home price of $236,000.
The right type of home
It is often the case in real estate that what we really want, is not what we can reasonably afford to get. We’re all allowed to dream. However, this does not mean that the difference between what we really want and what we can get should be so far apart. Barneveld has an ideal balance where what you really want, and being able to afford it, is possible.
Barneveld doesn’t lack space so you’re very likely to be able to find a home that has airy and often expansive outdoors views. This is, after all, village life, and one of the highlights is having pleasant greenery around your home.
You can typically get a 2-bedroom house with 1 bathroom, covering 1,500 square feet at around the $250,000 mark. There are also homes available at half that price that also have 2 bedrooms and 1 bathroom. However, for these less expensive options, you’re looking at half the square feet in coverage. Towards the higher end of the market, it’s possible to get larger and higher-end single-family homes with more bedrooms. Prices for these homes can range from $350,000 to just under $1 million.
Here’s where an objective and informed perspective like that from a real estate agent proves very useful. They can provide not only extensive information on the locality you’re interested in, but their experience should also give you some insight into what type of home would fit your goals and plans for the future.
Getting the right help
It’s a tough time all round. Everyone to some extent has been affected by recent world events, some more deeply than others. Financially, many are looking to cut costs and if there’s a way to save money, people are much more inclined now to do so. However, saving on agent fees is not a good money-saving tactic. Indeed, in many cases it could prove to be a false economy.
3% of a median-priced home for sale in Barneveld would be in the region of $7,000. At first, this seems like money worth saving by going it alone. So why would you work with a real estate professional?
- Real estate agents know their communities, at least good ones do. They know almost all, if not all the houses for sale, the conditions they are in, the history of the home, and its neighborhood. Need to know if there are good schools in the area, or which areas have good schools? Ask your real estate agent.
- Real estate agents know market prices and trends of an area. They can save you a lot of time, frustration, and hassle by giving the most up-to-date information at ground level.
Access to resources
- A Realtor may have access to an MLS (multiple listing service) that you do not.
- Realtors have developed close business relationships with a raft of third-party professionals, from lawyers to builders, especially in a village like Barneveld. This extended and trusted network immediately becomes part of your resources. There’s no need to scour and assess for other professionals, your realty agent will simply have them ready for you.
- You may have great negotiation skills yourself, but if you do, you should realize a lot of that relies on knowing your field of play intimately. Professional real estate agents have the knowledge and experience to fully leverage their finely honed negotiation skills. They’ll be able to get you the best price for your chosen target home. Without an agent, you may overpay, and not be any wiser till later, if at all.
- Real estate agents are generally better at getting a house in better condition. When a house needs essential repair work or maintenance, this may be overlooked or unasked for by a first-time buyer who doesn’t have the skill or the knowledge to assert themselves before they purchase. An agent can handle delicate or difficult asks, to the client’s advantage.
Administration and paperwork
- It’s not just the case that the paperwork can be complex as well as tedious. It’s the case that if you try to buy a house by yourself, you might overlook something or get something wrong. This might not only endanger the transaction, it might make you sign something you regret later. In a worst case scenario you could lose a lot of money and be embroiled in tricky legal issues. Peace of mind on something as big as a home purchase comes with working with a professional.
These are some of the main benefits of working with a real estate professional; there are many more. At the end of the day, it is possible to buy a house by yourself. But your chance of getting the right home, at the right price, in a stress-free and quick manner are greatly increased by working with a real estate professional. Buyer’s can get full representation via a contract called a “Buyer’s agency”. This allows the Realtor to craft the Offer to Purchase to get the Buyer the best terms versus the Realtor representing the Seller and getting the Seller the highest price and best terms. Plus, if the property is listed on the Multiple Listing Service (MLS) , the Seller is offering to pay for the fee charged to the Buyer for the Buyer agency. So the Buyer gets full representation from the Realtor and the Seller pays the fee. It’s a win – win for the Buyer!
Potterton Rule is Southwest Wisconsin’s finest
Potterton Rule Inc. has been serving the communities in Southwest Wisconsin for over 80 years. Today we help by providing a full service to our clients from hosting virtual tours to providing insurance. Our service is something we take great pride in and being recognized as the best realtors in Iowa County in 2020 only makes us even more determined to continually provide the best service in the area.
Here’s what one client said about our service:
“I worked with Andrea Potterton for the purchase of my very first home, and she was absolutely wonderful. Her professionalism and responsiveness were top notch. Each step of the way, she walked me carefully through what the process would be like and what I should expect. I never worried, knowing that Andrea was working tirelessly behind the scenes to make everything come together. When she arrived (always promptly, of course) to showings, she would come packet in hand with all the materials on the home for me to look at already prepared, and when the home buying process began, Andrea was a steady guide to explain to me how everything worked and what I should do in each particular scenario. I highly recommend Andrea and Potterton Rule.” – Emily Gee, September 13, 2021
Potterton Rule Inc. currently operates 4 offices in the Southwest Wisconsin area but you can get in touch with us at 608.935.2396 or send us a message at info(at)pottertonrule(dotted)com. We’d love to hear from you.