The Ultimate Home Buyer's Guide: Everything You Need to Know Before Making a Purchase
- Shay Weatherspoon
- Nov 11, 2024
- 4 min read
Home Buying Guide Just for You!
1. Assess Your Finances
Find Out Your Credit Score: This helps determine your eligibility for a mortgage and the interest rate you will pay. The golden rule is to shoot for a score of 620 or more.
Determine Your Budget: Review your income, debts, and savings. Decide how much you can afford comfortably for your down payment as well as monthly payments.
Determine Extra Cost’s: Don’t forget! Budget for closing costs (2-5% of the home price), moving or relocating expenses, and an emergency fund.
2. Start The Pre-Approval Process
Choose a Lender: Research and shop around, compare your many different mortgage options. The goal is to choose a lender that offers competitive rates and terms that fit your home buying needs.
Submit Financial Documents: You will need to provide recent tax returns, pay stubs, bank statements, as well as debt information.
Collect Your Pre-Approval Letter: This letter shows home sellers you are a serious buyer, and you have already taken the first step, helping to drastically strengthen your offer.
3. Decide on Your Home Features
List Your Must-Haves: Think about sqft, number of bedrooms and bathrooms, location, yard space, foundation type, HOA or No HOA and any other key features.
Consider Lifestyle Needs: Proximity to work, school districts, and home and neighborhood amenities may also help determine your decision.
Be Flexible: While having priorities is necessary, staying open to compromises may help you find a home that is the perfect fit for you.
4. Find a Real Estate Agent
Choose a Great Agent: A knowledgeable and savvy real estate agent will guide you through the buying process and help you find the best deals in your desired area.
Discuss Your Needs & Wants: Communicate your budget, home preferences, and desired location.
Set Up a Plan: Your agent will organize home tours and alert you to new listings that fit your criteria. Communication is key**
5. Start the Home Search
Browse Online Listings: Use real estate websites to explore options and get a feel for pricing.
Tour Homes: Visit properties to evaluate the homes layout, the condition of the home, and the neighborhood.
Take Notes: Compare homes and rank your preferences (considering it is not a sellers’ market!) to keep track of your top choices.
6. Make an Offer
Decide on Your Offer Price: Your real estate agent will advise you on a fair offer based on market conditions and recent sales also known as “comps”.
Include Contingencies: Common contingencies when writing an offer include financing, inspection, and appraisal, closing and more. These can protect you if issues arise.
Negotiate as Needed: Sellers may counter your offer. Be prepared to negotiate terms and price with the seller.
7. Conduct a Home Inspection
Hire a Licensed Inspector: An inspection will help you understand the home’s condition and spot any needed repairs, concerns, or structural issues. ** Rule of thumb, never skip a home inspection!
Review the Report: Based on findings, you can request repairs, negotiate the price, or walk away.
Consider the Costs: If the home requires significant repairs, factor these costs into your decision to proceed.
8. Get an Appraisal
Appraisal Required by Lender: The lender will assess the home’s value to ensure it is worth the purchase price. *Protecting the bank as well as you!
Review the Appraisal: If the appraisal is lower than your initial offer, you may need to renegotiate or cover the difference.
9. Finalize Your Loan
Submit Final Documents: Provide any additional info your lender may need and avoid large purchases or credit changes before closing. *No Furniture Shopping until after closing!
Loan Approval: Once the lender has all the documents and everything is clear and good to go, the lender will approve your loan, and you will receive your closing disclosure.
Review Terms: Carefully check all terms and fees, so you understand your mortgage agreement. Read the documents with a fine-tooth comb, contact your lender if there is anything you do not understand.
10. Prepare for Closing
Conduct a Final Walk-Through: Check that the property is in the same condition as it was when you first toured, and any agreed-upon repairs were completed.
Bring Necessary Documents and Funds: You will need your ID, proof of homeowner’s insurance, closing disclosure, and payment for closing costs.
Sign the Paperwork: At closing, you will sign documents to finalize the loan and transfer ownership.
11. Get the Keys and Move In
Receive Your Keys: Once the paperwork is complete and funded, the home is officially yours!
Celebrate and Move: Arrange your moving plans, set up utilities, and enjoy settling into your new home. *You can finally shop for new furniture!
Additional Tips for a Smooth Buying Process
Stay Organized: Keep copies of all important documents.
Be Patient: Finding the right home may take time, and each step is necessary for a successful purchase.
Lean on Your Agent: They are here to support you, answer questions, and make the journey easy and smooth.
This home buyers guide will help you confidently navigate each step toward home-ownership, making the process simpler and stress-free. Enjoy your journey to finding a place you can truly call home!
By: Shay Weatherspoon
Comments