Since buying a home is the biggest investment you’ll make, here a home buyer’s guide to help you along the way.
Do your homework! Learn what’s for sale and note what you like that you see for sale. Develop a sense of housing trends in your community.
Lenders seeking borrowers who will spend three to five times their annual household income. So, if you’re earning $120,000/year, your home should cost between $360,000 and $600,000. The challenge: finding the best house for the lowest price in the right place.
Get your affairs in order and prepare them for your banker or loan officer. Your lender will tell you specifics of your borrowing level so you can determine a corresponding home cost.
Real estate agents know their neighborhoods, know previous sale levels, know all about schools and commute times and will guide you through the process.
Want to do it online or by yourself without an agent? Really? Why?
Agents make an average of six percent commission—but their take-home is usually two percent and not paid by home buyers anyway. They’re valuable and so is your time.
Check out the house. Check out its little quirks. Have an inspector in mind to find flaws.
Look around the neighborhood. What do you see in terms of traffic, parking, upkeep, and schools?
An inspector is responsible for finding things that are not working or are soon to stop working. From plumbing PVC piping to electrical concerns to appliance ages, landscaping problems, bugs and more, a good inspector allows your real estate agent to negotiate with the seller to fix everything before you own it.
Tell him your future plans so that your loan accommodates your monthly payments and accommodates potential future life changes like kids leaving and parents moving in.
A third-party appraiser will determine what the home is really worth to them.
Well, hopefully not if you’ve followed the previous eight steps. Let’s just say you’re making the biggest forward move of your adult life. The monthly mortgage that seems outrageously high today will be peanuts in 20 years when wages catch up with your home investment. Inasmuch as you may swallow hard, you’re also the cat who has swallowed the canary. Look forward. Smile between clenched teeth. You’re earning equity.
Now, go sign everything and smile! You’ve achieved the American Dream.
We hope this home buyer’s guide will help ease your mind as you’re getting ready for your dream home!