Home Buying 101
Whether getting your starter home or your forever home, becoming a homeowner is an exciting step. Let Jamie and Terri at 1827 Real Estate help you navigate the process smoothly from start to finish. There are many important tips to follow to make your home buying experience successful. Consider these tips and give 1827 Real Estate a call to start your journey to homeownership:
· Determine if The Timing is Right—Being able to put your money towards a home instead of rent can be a wise choice. If you have the finances and you plan on being in the same area for around five years, the timing may be right. Also, considering the market is wise if you are not in a rush to move. You do not want to overpay for a house because it is a poor housing market for buyers if you can help it. A home is a big financial decision, so it is best to make sure you are making the right call.
· Make Sure You Have Your Finances Ready—Saving for a down payment is crucial. Ideally, having 20% of the purchase price to put down is wise. However, there are many loans which may only require 3% down, such as conventional mortgages and FHA loans. If you are a veteran, a VA loan could be a good option because it may not require a down payment. Keep in mind that higher down payment means lower monthly mortgage payment. Regardless of your loan or down payment, you need to make sure that your monthly payments will be feasible based upon your assets and earnings. You do not want to get your dream home and then lose it because you are financially overextended. There are some state and local programs which offer assistance with down payments and other costs, especially for first time homebuyers. We can help you explore these options fully if you need the help with your down payment.
· Explore Your Mortgage Rate Options—Mortgage rates vary based upon the bank. You could save thousands of dollars over your first five years by shopping around. We recommend getting quotes from three different lenders.
· Get Prepared for Shopping In Your Budget—If you are a serious homebuyer, go ahead and get pre-approved for a mortgage. Not only will this guide you in how much you can reasonably afford, but you will also be able to move more quickly if you find your dream home. Also, get your credit checked to make sure that you will not have any hang ups getting your loan, such as errors, outstanding debts, etc. We do not recommend looking at homes beyond your budget. You do not want to fall in love with a home which is unrealistic for your means. Although sale prices can be negotiated, you should not aim too high and depend on this. If you only view homes at the top of your budget, you will not have money remaining for repairs, home renovations, furniture, or any other additions you may want.
· Determine What Matters Most—You may not find the perfect home unless you build it yourself, but you should know what features matter the most to make you happy. Choosing a home with a quiet and safe neighborhood, a good school district, easy access to shopping or amenities, desired number of rooms, yard size, etc. will make your home purchase better for your whole family. Making a list of your priorities can help guide our agents in helping you locate a home which achieves your goals.
· Keep Some Money on Hand—A house costs more than the price tag you see on Zillow or MLS listings online. You need to factor in extra money for closing costs, moving expenses, repairs, furniture and decor purchases, paint or renovation supplies, fixtures, appliances, etc. Your dream home is more than just the four walls; you still want to have the money you need to make it your own.
· Get a Good Home Inspection—A home inspector can save you from buying a money pit with lots of expensive repairs you did not plan on. Make sure to ask what all the inspector will look for before hiring them. You want a thorough home inspector who will look at everything from the roof to the basement. Attend the home inspection so you can ask questions along the way. The home inspector should provide you with documentation of their findings. This report can provide valuable information for negotiating. For example, if the home needs a new air conditioning unit, you can try to negotiate the cost down with the seller to account for it.
· Shop Around For Homeowners Insurance—You are required by your lender to have homeowners insurance lined up before your closing. Different companies may provide better rates or coverage. Typically, the cheapest one will have more limitations with coverage so keep that in mind when making your decision. Also, floods are typically not covered so if you live in a flood prone area, consider adding flood insurance as well.
Home ownership is an exciting moment and the team at 1827 Real Estate would love to share your joy and journey. We are ready to help you get started finding the perfect home. Call today!