As one generation of homeowners steps back, another steps up. It’s a significant step towards becoming independent and investing in your future. However, sometimes the process of finding the perfect home can be overwhelming. Here though, I will give you the essential steps to guide you through the journey of buying your first home.
Determine how ready you are
Before you start browsing listings, one of the first steps you must take is to assess just how ready you are. You can do this by looking at a variety of determining factors. Take a look at your credit score and determine where that would put you in the loan market. A higher credit score will help you secure a better mortgage rate. Next, Set a budget and stick to it. For this, you are also want to factor in property taxes, insurance, maintenance and utilities. The final step in the readiness stage is to ensure that you have enough to make a down payment on your home. The typical down payment is 3% to 20% of the total home price.
Get Pre-Approved
Getting pre approved puts you at a competitive advantage by showing sellers that you are a serious buyer. It also paints a picture as to how much you can truly afford. The first thing you want to do is take a look around at different lenders. Compare their rates and terms to ultimately find the best fit. Before going to a lender though, prepare any financial documents you may need; Such as pay stubs, tax returns, and bank statements. The final thing you need to do before moving into the next step is to explore the different types of mortgages to see what works best for you.
Define Your Needs and Wants
Now that you have assessed your financial situation and have it in writing that you have, it is finally time to start considering what best fits you! The first thing to consider would be the location of the home you are looking for consider the distance from work, schools, amenities etc. Next consider the layout, this would be the number of bedrooms and bathrooms as well as the style of the floor plan. Are you looking for something more open or something more traditional? Finally, consider your plans for the future, do you plan to expand your family? Or maybe work from home?
Find a Real Estate Agent
The fourth step is where I come in and be your best ally in the home-buying process. Here are some things to look for when choosing the agent that best suits you. Be sure that they know the local market, this is essential for you when it comes to picking the neighborhood that fits all of your needs. They should also be able to communicate well and have experience with first-time homebuyers.
Start House Hunting
Now that you have your pre-approval and agent in place it is time to start looking for that perfect home! Here are some tips to keep in mind as you’re on the hunt! Be open minded, don’t rush, and most importantly take notes. Visiting multiple properties at once can be overwhelming. Go through each home and draw out the key pros and cons. This is a very big decision that should be well thought out. Always always always take your time.
Make an Offer
You’ve found the home you’ve always dreamt of. Now what? Your agent will help you craft a competitive offer based on current market conditions. Be prepared for negotiations and consider including contingencies (such as a home inspection) to protect your interests.
Close the Deal
In the final stages there are a few things that will happen. If you choose to get a home inspection, it will take place before closing. This could affect your purchase decision and may give you leverage in negotiations. Some things that can be found in an inspection are structural issues, electrical and plumbing problems, roof condition, and the presence of pests. If everything pans out it is time to go to closing! During closing your lender will do all necessary paperwork, closing costs will be paid, and the terms and conditions will be interpreted to you.
Move In and Enjoy Your New Home!
Congratulations! You are now a homeowner! Take the time to celebrate and keep a few things in mind. Be sure to customize your space to make it feel like home. Change the locks for security purposes. And set up your utilities and services.
Embarking on the journey to homeownership is a significant life milestone that can be both thrilling and daunting. It can absolutely be a reward experience. Take the time to educate yourself and make thoughtful decisions; Always remember to take it step by step. And never hesitate to reach out for help when needed. Happy House Hunting!
