Steps to Buying your First Home
First time home buyers may be faced with some challenging steps. However a competent realtor can guide you into a fun and stress free journey if you follow the steps effectively. We detail below the first steps toward buying your first dream home:
- Gather your Down Payment: The first step is to figure out your financial situation. In order to get your first time home buyer loan you will need to have your mortgage application approved. A lender will lend you the money that you will pay back over time. Ideally, a 20% down payment is sought. However, down payments can be as low as 10%, 5%, or even 0% for certain types of mortgages (e.g., VA loans or a USDA loan).
- Check your Credit Score: Forgot some payments? Check now. It is one of the most important first time home buyer steps. Your credit score will be crucial in your loan approval. Here you will find more on how to check your credit score and what number is best to buy the first home of your dreams.
- Get your Mortgage Application Pre-Approved: It’s time to get your mortgage application pre-approved from a lender. Your financial background will be scrutinized. Your current debt to income ratio and assets—will be used to determine your eligibility and affordable monthly payments. Now you can determine the price home you can afford. Be aware that pre-approval is different from pre-qualification. The former requires a ton of paperwork. Before meeting a lender, you can calculate your affordability here.
- Find a Trusted Real Estate Advisor: He or she will be your guide through this process. Hire someone you trust and someone who is very experienced in real estate. Afterall, they will be negotiating on your behalf. Good news: the seller pays the sales commission-so this
- Go Shopping and Find your First Home: Perhaps the most fun aspect of your home purchase! Identify your priorities and your wishes. Your real estate advisor is responsible to set up showing appointments. Know what you are looking for when you visit the property and be realistic.
- Make an Offer: You found your dream home! Now, make an offer to the seller. Your real estate advisor plays a key role in this step. This is where experience and tenacity come into play; they are negotiating on your behalf.
- Home Inspection: A professional home inspector will be hired to check out the property’s condition from top to bottom. Your real estate advisor will review the report with you to determine the items you will request to have fixed.
- Home Appraisal: Most lenders and loans require a home appraisal. This determines if the property is equal to or less or more than your purchase price. Here you will find more information about the home appraisal process.
- Settlement: It’s finally here! You are buying your first home! Be prepared for alot of signatures and information!
- Pack your bags and move in! Got your keys? Congratulations, you’ve officially graduated from a home buyer to a homeowner! Find some tips here to aid in a stress free move. With a good real estate advisor on your side the homebuying process can be fun and stress free! Afterall, it should be! Now- time to enjoy the many benefits of being a home owner.
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