The 10 Steps to Follow When Buying a Home
Buying a home is one of the most significant investments you may have to make. Choosing the right house may be challenging because of the factors involved, such as cost, neighborhood, and space. Since you will need a lot of time and effort to find a house that best fits your needs, the 10 steps below will help make the process easier and make the right decisions:
1. Start Looking for the Home You'd Want Early
When you decide to buy a home, start going through newspapers, magazines, websites, and real estate listings for the type you'd want. Check how long the house you like stay on the market. Additionally, check if there are changes in the home's asking price. That will enable you to understand the housing trends in your desired neighborhoods.
2. Create a Budget
Experts recommend looking for homes that cost between three and five times their annual income. However, it would be best if you decided, depending on your financial situation. You can consult a housing expert to help you know the kind of house you can afford. With that, you'll learn how much down payment to save each month.
3. Get Your Mortgage Prequalification and Preapproval
Knowing how much to spend on buying a home is essential before you start looking for one. You can do that by getting mortgage prequalification. You will have to provide your financial institution with some financial information, such as your annual income, savings, and investments. Your lender will let you know the amount of credit you can get after reviewing this information. That will guide you on the price range of the houses to check. You can then get credit preapproval after providing your financial documents for your bank to verify your credit and financial status.
4. Look for a Real Estate Agent
Real estate agents will help you when buying or selling a home. They can help you find a suitable home in your preferred neighborhood. It would be best to involve an agent because they understand the home buying process, the locality you want to live in, and negotiation skills.
5. Search for a Home and Make an Offer
Start viewing homes that fall under your budget. Write down notes about the different houses you visit. It might be impossible to remember details about all the homes you see. Also, take some videos or pictures to have clear memories of the homes. Check the condition of the houses you view, such as the plumbing system, electrical system, and windows and doors.
Additionally, check if the neighborhood is safe, well-maintained, and located near places you need, such as a shopping center, parks, schools, and workplaces. Don't be in a hurry to settle on a house. After finding your perfect match, consult your agent to negotiate a fair offer depending on the prices of similar homes in the area.
6. Have the Home Inspected
Purchase offers usually include a home inspection, which involves checking for damages to the structure and other things. Your real estate agent will find a professional to inspect within a few days after the seller accepts your offer. You may change your mind if the inspection reveals extreme material damage. However, if the house needs a few repairs only, you can request the seller to fix them before you close the sale. Confirm if the property owner has made the repairs before closing the deal.
7. Consult a Mortgage Adviser and Select Your Loan
There are different lending institutions you can approach for a mortgage. Since you will have many questions regarding the loan you need, it would be a great idea to compare a few lenders before settling on one that provides the best services at affordable prices.
8. Get the Home Appraised
The lender you choose will plan for an appraiser to provide you with an independent estimate of the worth of the home you want to purchase. The appraiser is not directly associated with the financial institution you choose. They will provide you with a fair price for the house.
9. Confirmation of the Paperwork
The home buying process involves a lot of paperwork. Therefore, your lender will choose a company to check all the papers and confirm the seller is the valid owner of the home you want to buy.
10. Close the Sale
It's where you sign all the paperwork involved in the home buying process, including the loan documents. The lender will need a few days to release the funds after receiving the signed papers. After the lender delivers the check to the seller, you can move into the new home.
The home buying process requires careful considerations and follow-ups because a single mistake can cost you more than you would ever imagine losing. Use the steps above when buying a home to ensure you do things correctly and finally own your dream home.