Are you prepared to buy a house? You may be delighting in daydreams of homeownership, but buying real estate is a process that requires a lot of preparation. Before you hit the streets in search of the perfect place to hang your hat and call home, check out these six steps to buying a house.
Busting Open the Piggy Bank
You already know buying a home takes big bucks. If you’re more than daydreaming and into the phases of planning your adventure of becoming a homeowner, then you’ve likely already saved up a healthy chunk of dough for your down payment. However, there are more costs to purchasing property than a twenty percent down payment. Along with the offer you submit on the house you want to buy, you’ll fork over cash for an earnest money deposit. The buyer also accepts responsibility for the closing costs in most cases. Furthermore, you’ll dish out the green for homeowners insurance and property taxes. To avoid being house-poor, make sure your savings cover all of the expenses involved with your purchase.
Pre-Approval for the Home Mortgage Loan
Even after you’ve scrimped and saved to put down your twenty-percent with pride, you’re still going to need a home mortgage loan. Many buyers make the mistake of waiting to apply for their loan until after they’ve found the house they hope to buy. Unfortunately, the application process may deter sellers who prefer to work with empowered buyers or buyers who have already secured a home mortgage loan. Not only can pre-approval position you as a serious buyer, but it can also give you an accurate idea of your home-buying budget. Additionally, the pre-approval sends a signal to real estate agents that you’re ready to do business.
Before you apply for your home loan, make sure your credit report is immaculate. Avoid making any significant or costly purchases in the months leading to your application. Lenders will measure your debt-to-income ratio, and big-ticket items such as cars or financed furniture could get in your way.
The Right Real Estate Agent
With money matters in order and the loan pre-approved, you’re ready to find your ideal real estate agent. Interview agents, ask questions, read reviews and ratings. Your representative in real estate should be familiar with the areas in which you’d like to look for houses, as well as the types of property you’re interested in buying. His or her communication skills should be stellar, and – last, but not least, you should like his or her personality.
Making Your Offer
It’s go time! You’re locked, loaded, and ready to pull the trigger on the purchase of your dream house. Your real estate agent will help you create a do-able wish list to fit your budget. You’ll then tour homes that meet your criteria. When you find the right house, your agent will help you submit an offer and negotiate terms. But don’t get emotionally attached to the house just yet. There’s more work to be done.
Appraisals, Inspections and Surveys
This is the hard part. Before you can put that welcome mat at the front door, the house you’re buying must be surveyed, inspected, and appraised. The survey defines the property lines, the inspection verifies the condition of the house, and the appraisal determines the current home value. Each of these processes takes time, so you’ll need to practice patience. During these phases are the final opportunities for negotiations. Once these tasks are checked off as complete, the contract is locked in and you’re well on your way to becoming a homeowner.
Sealing the Deal and Moving In
With the title cleared for transfer, the loan money in place, the contract signed, and the escrow agent dishing out the closing costs for services provided during the transaction, you’re about to get the keys to your house! By this time, the seller has packed up and removed all of their belongings and left the house in good condition for your move-in celebrations. Wrap up that paperwork, snatch up those keys, and enjoy your new house. You’ve earned it!
Your real estate agent is the best source of information about the local community and real estate topics. Give Heidi Herda a call today at 612-807-4858 to learn more about local areas, discuss selling a house, or tour available homes for sale.