24 Oct The First Steps to Buying a Home
Buying a home takes a lot of time and effort. Make sure you can manage your finances and make the best decisions possible by following these steps.
Start Your Research
Make a note of any particular homes you are interested in and check how long they have been on the market, the asking price, or any price changes. Are you looking for an area with shopping and an active nightlife? Are you looking for something more quiet with less traffic? Do you prefer a certain school district? These questions are important for your long term future. Start reading newspapers, magazines and websites that have listings in your area of choice.
How Much Can You Afford?
This decision is based on your own financial situation. It is usually recommended that home buyers stick to spending no more than 3-5 times their annual income. Most home buyers plan for a 20% down payment. To save for a down payment, contact us at Bank of the Lowcountry to open a savings account. This will make it easier to put aside money per month and help you stay on a steady track.
Get Prequalified and Preapproved
Before looking you need to know how much you can realistically spend. To get prequalified you’ll need to provide your financial information to a mortgage banker. The lender will review your income, investments and your amount of savings. They will provide you with how much they can lend and your price range. You can also get preapproved for credit, which involves providing financial documents such as paycheck stubs, W-2 forms, and bank account statements.
Find a Real Estate Agent
Finding a real estate agent you trust is an important step. You can purchase a home without an agent, but keep in mind they will work hard on your behalf to negotiate the best sale terms and price. Ask friends and family for referrals. An agent that is familiar with your neighborhoods, responds quickly, and makes you feel comfortable is very important. Ask around to see who has worked well with others to make sure you find the perfect fit.
Shop for Your Home
Start shopping for homes in your price range. It will be hard to remember the many homes you look at, so make sure to take notes, pictures, or videos. Check for the small things like windows opening, doors, electric, water pressure and plumbing. Is there enough parking? Traffic in the area? Are surrounding homes well maintained? Take as much time as you need to find the perfect home for you and your family.
Get an Inspection
Your real estate agent will help you set up a home inspection within a few days of your offer being accepted. Both you and the seller will receive a report on the home inspector’s findings. You can then decide if you want to ask the seller to fix anything on the property before closing the sale. Before closing, you will have a walk-through of the house, which gives you the chance to confirm that any agreed-upon repairs have been made.
Have the Home Appraised
A home appraisal is an unbiased estimate of the fair market value of what the home is worth. The appraisal lets all parties know they are paying a fair price for the home.
Close the Sale
When closing day arrives, you’ll need to have a certified or cashier’s check in-hand that covers your closing costs. Your mortgage lender will provide an exact amount ahead of time. You will sign all of the paperwork required to complete the purchase, including your loan documents. Once the check is delivered to the seller, you are all set to move into your new home!
Although purchasing your first house can feel a little daunting, preparation and research will go a long way. When the time is right for you, buying a home can be the best decision you’ll ever make. Welcome home!