Baseball, Mom, Apple Pie…and Home Ownership. It’s the summation of the American Dream. Buying a home is both an exciting and involved process. The more you know about buying a home, the better informed you’ll be to make the appropriate decisions. Here are ten steps to consider when you’re ready to start looking for a home.
1. Start now and Save, Save, Save! Generally, the more money you put down on the home purchase, the more likely you are to be approved for a loan and better terms. Certainly, you’ll pay less interest since your loan amount will be smaller.
2. Prior to your search for the “perfect” home, write down your needs and your wants. E.g. “Needs: 3 bedrooms, 2-car garage, etc. Wants: 2 bathroom and next to park.”
3. Save an additional amount of cash for expenses after moving in, such as repairs, fencing, window treatments, furniture, landscaping, or carpeting/flooring replacement. These expenses can easily amount to $5,000 or $10,000 or more.
4. Look at your household budget and determine what you can afford as far as a total monthly house payment is concerned. Don’t leave it to your lender or real estate agent to set that figure for you. Also, keep in mind that the figure quoted by a lender is generally a “good faith estimate” only, and may not reflect your eventual monthly payment.
5. Contact local lenders group or the housing authority to find out when the next free home buyer education program is available. Besides preparing you for the finer points of buying a home, you may also receive a Certificate of Completion that can qualify you for interest rate reductions, government grants, or other benefits.
6. Get a referral from family, friends, or other trusted acquaintances before contacting a mortgage lender. Make an appointment with a mortgage lender. Find out what your loan options are and go through the pre-approval process.
7. Once again, get a referral from family, friends or other trusted acquaintances and contact a reputable real estate agent to begin looking for a home.
8. Particularly when looking at an existing home with no warranty, it is recommended that you have the home inspected by a professional for your protection. Even newly-built homes may be damaged, have poor plumbing, or show signs of faulty construction.
9. Shop around for homeowners insurance. Ask about discounts from companies that can insure both your home and your car(s). Let the lender know the name and contact information of the insurer you’ve chosen.
10. Move in and invite family, friends and new neighbors over for a “house warming” celebration.
Best wishes while you endeavor into the home buying experience.
If you have any questions, would like to discuss any financial challenges you may have, or are just looking for advice, please contact us at your convenience. As always, we are here to help and look forward to hearing from you.