What You Need To Know Before Buying a Home
Buying a home is one of the most exciting and potentially largest purchases you will make in your lifetime. You’ll not only invest your money but your heart into making a house into a home. The happiest Buyer’s are typically the most prepared Buyer’s.
Here are the top 8 tips to get you ready for your new home.
1. Working with the right Realtor– Don’t be afraid to interview a few Realtor’s to make sure they are a good fit for you. A Realtor who is listening to your needs, knows the area you want to buy in, and is ready to negotiate on your behalf, is worth their weight in gold. They will save you time, money and get you into your dream home quicker.
2. Clean up your credit– Before stepping into the buying process, check your credit score. A credit score over 700 can get you a lower interest rate and save you thousands in the long run. Paying off credit card debt and car payments before you purchase a home can make buying your house easier and open the door for better loan plans.
3. Find a Lender that best fits your needs– Most Lenders have a specialty – First time home buyers, credit problems, flippers, and high end homes are just some of the areas Lenders can specialize in. Being open and honest with your Lender can help them fight to get you the best rates. There is more to a loan than your APR – Annual Percentage Rate. Also, ask the Lender about points and closing costs. Make sure you are looking at the bottom line, not just the rates.
4. Protect – don’t effect your financial status– Most Realtor’s will want you to have a Pre-Approval letter from the Lender before they start showing you houses. This insures they are showing you houses in the price range that fits your budget. Once you have the Pre-Approval Letter, make sure not to make any large purchases, change jobs, or run up credit cards. The Pre-Approval is based on your situation at the time you apply. There is nothing worse than thinking you are moving into your dream home only to find out you no longer qualify.
5. Buy the house you can afford– Once you are Pre-Approved, it’s time to start thinking about your lifestyle. Sometimes, you are approved for more than you feel comfortable spending. The first step is to figure out your debt to income ratio.
Remember, your mortgage payment will also need to include insurance, HOA fees, and property taxes. What money do you need to set aside for repairs? Do you like to go out to eat, have exotic vacations, or send your kids to private schools? Make sure you look at your lifestyle and what is important to you. It is disappointing to have to give up your lifestyle in order to make a large mortgage payment.
6. Buy the house for today…and tomorrow– Whether it is your first home or your third, it is always important to ask yourself how long you plan on staying and what your future looks like. Do you travel for work and don’t want lawn maintenance? A condo may be best. Are you newly married and planning on kids in the near future? A big backyard may be important. Do you like to be close to restaurants, shopping, and work? Or, does space sound more appealing? Remember, you are not only buying a home but a location. It may come down to Space vs. Location.
7. Get to know the Neighbors and the Hood– Make sure you are researching everything that is important to you. The schools in the district, jobs, and crime rates are all accessible. Knock on the neighbors doors and ask questions. Drive the neighborhood in the morning, day, and night to get the feel for it. Check your Lifestyle list and make sure you are checking off the items that are most important to you.
8. Lastly, buying a home involves a contract– and a lot of paperwork to sign. There are standard contracts but they are negotiable. A good Realtor can help you with this process of getting what you want. For example, extending the length of the inspection period, adding in an Addendum that you will need to sell your house first, waiving the appraisal, (if you are a cash buyer), and asking for things in the house such as appliances.