Buying a home is an exciting time in anyone’s life. But it can also be a little confusing. It’s a lengthy process and if you skip an important step, you could find that you can’t buy a home at all or that you end up paying significantly more for a house than you could have. These steps will ensure that you buy your home as quickly and painlessly as possible from start to finish.
As excited as you may be to hear the words offer accepted, you need to lay the proper groundwork first. That means checking your credit and, if required, building it, so you qualify for a loan. The higher your credit score, the better your mortgage terms will be. You’ll also want to save money for your down payment and closing costs.
Most conventional loans require at least 3% down, but the more you save, the lower your mortgage will be. And you need to figure out how much home you can afford so when you start looking, you don’t fall in love with a house that’s entirely out of your budget. This may be less than a lender will give you, and it’s important to know so you don’t end up with debt you can’t afford.
Find Your Lender and Agent
The next step is to find a lender. You should shop around and consider more than just how much money they’ll give you and at what rate. Look at their customer service as well. Once you find a lender you like, take the time to get preapproved for a loan. Prequalification gives you an estimate of what your loan might be, but preapproval is a guarantee of what your loan will be.
This makes it clear to sellers that you are serious and in a position to buy. This is also the point in the process where you’ll start looking for a real estate agent. Like finding a lender, you should shop around and interview several agents before choosing the one you think will best represent you and your interests.
Know What You Want and Start Looking For It
When looking for a home, certain things are more important to you. Set your priorities and communicate them clearly to your real estate agent so they can help you find homes that meet your criteria. As your agent sends you listings to consider, pay attention to how well they match your priorities.
Be open to looking at ones that aren’t a perfect match and ask your agent how they determined that it might be a good fit for you. When you do find a home, don’t just blindly offer the asking price. Work with your agent to find out what a fair price should be and what factors might help lower the price. Consider putting contingencies on your offer as well.
Inspect and Buy Your New Home
Once you hear the words offer accepted, the final part of the process is to get a home inspection to make sure there are no surprises when it comes to repairs, security, or other issues. Your lender will also require an appraisal of the home at this stage. Once the inspection and appraisal are done, and any necessary repairs are made, or an agreement to pay for those repairs is made, the final step in the process is to close on your new home.
For many buyers, this is the most exciting step in the process. You’ll first do a walk-through with your agent to make sure everything is still in order and that any repairs the seller agreed to make have been satisfactorily completed. Then you’ll sign the paperwork and get the keys.
There will be a lot of paperwork, so you’ll want to read it all over carefully and make sure all the numbers are correct. Once everything is signed, the home is officially yours. Congratulations! Becoming a homeowner is a huge responsibility.
Understanding what you’re taking on and the process you’ll go through to do it can make that responsibility feel less daunting. It will also make sure that you get the home you want without regrets later.