Finding your first home can be both exciting and daunting, so it’s essential that you identify what features are essential and which may be deal breakers.
Before viewing homes, it is also a great idea to establish your budget and get pre-approved, which will save both time and money over the long haul.
1. Know Your Budget
Purchase of your first home can be an exciting endeavor, but it is crucial that you consider all financial implications. For example, if your budget cannot stretch far enough to include what you need from a property search criteria or even exiting altogether.
Many home buyers tend to focus on their mortgage payment while forgetting other costs like closing costs and maintenance expenses. Determining your budget can be daunting, but doing it early will help avoid costly mistakes later on. Utilizing online calculators such as affordability tools is an excellent way of helping determine what your budget allows. Consider cutting spending or forgoing unnecessary purchases before creating it!
2. Set a Timeline
Setting a timeline for your home purchase will help keep everything on schedule and on schedule.
Homebuyers should expect the home purchase process to take approximately 50-60 days from offer to closing, including time for appraisals, loan processing and any unanticipated issues that may arise during this time.
Home buying can be one of the most complex financial decisions that you’ll ever have to make, but understanding how the home-buying process and budgeting for it works can help make this journey smooth and stress-free. By following these simple guidelines you can ensure a successful journey.
3. Get Pre-Approved for a Mortgage
Start the home buying process off right by getting preapproved for a mortgage. This will give you an idea of what your maximum home budget will be and identify any credit issues you need to address prior to beginning.
Preapproval also sends the signal that you’re serious about making a purchase in competitive markets where buyers might face competition from multiple bidders.
While undergoing the preapproval process, make sure not to make any significant changes to your financial profile. Your lender will conduct a credit check before providing a preapproval letter with an expiration date.
4. Look for a Real Estate Agent
Finding an experienced homebuyer or seller agent in your area is essential to success when buying or selling real estate, so a great way to find one would be through referrals from friends and family members.
But you should also do your own due diligence by searching online for customer ratings and home closing stats of agents in your area. Make sure they communicate clearly, listen well and have a work style compatible with yours.
Interview several agents and ask about their experience working with first-time buyers or specific purchases like foreclosure purchases. Also find out whether or not they will represent either party during the transaction process.
5. Get a Home Inspection
No matter how great a house may appear on paper or how effective your real estate agent might be, professional home inspection is crucial to make an informed decision about whether to request price reductions, negotiate credits on purchases or hire professionals to perform repairs.
Find a Home Inspector You can select your inspector by yourself or request the advice of your real estate agent, who likely has worked with many inspectors before and can recommend highly experienced, reliable inspectors for you.
6. Make an Offer
Once you’ve found a home that meets all your criteria, it’s time to make an offer. Your real estate agent can assist in setting a fair price based on comparable home sales and condition of the property.
Sellers tend to give priority to offers with pre-approval for mortgage financing, so getting this step done early is critical. You could also try differentiating yourself by providing other concessions such as paying closing costs or contributing towards home warranty fees.
Remember that bidding wars are common in hot markets, so be prepared for negotiations. Make your offer realistic and avoid making unreasonable demands.