Get Assistance From Professionals
Buying a home by yourself is a big mistake. Even if you can buy a home with cash it is not a good idea to buy it without the help of professionals.
- A real estate agent can assist in negotiating your deal
- A title company or real estate attorney is a good idea to handle the title transfer and getting the new deed in your name correctly
- Home inspector to look for physical defects in the home
- An appraiser to confirm the value and sales price you want the home for.
Shop Around
It is a very good idea to look around. Make sure that you see several homes in your price range. This way, you’ll be able to see homes with different features, rooms, square footage, a pool (or not), among many options a home can come with. You may like one home and think that you must put in an offer to make sure that you at least get something. This simply isn’t the case.
There are too many homes on the market, and coming on the market, such that you don’t have to take the first home that comes along. The excitement of being a first time home buyer and buying your first home can be a little frustrating and perhaps make you a little impatient and nervous. So take your time. Make sure that you look outside the home at the yard, neighborhood and location to supermarkets and schools. Ask yourself the question: does this home fit my needs?
Get Pre Qualified
Your First Step in buying a home should be to get your financing options figured out by getting pre qualified. This step takes 15 minutes tops and should leave you with the approximate price range where you should be looking. For the pre qualification to mean more, you ought to go through the pre approval process with at least one loan officer. Once you complete this process you’ll be able to search for a home with confidence. Also, any real estate agent who knows what they are doing should not take you out looking for homes until you show them a pre approval letter.
Finding a home that you like and want to put an offer in can be frustrating if you are not already pre approved by a mortgage lender. Imagine writing an offer on a home, having it accepted and then finding out that the house is $25,000 above your price range that you qualify for considering your credit card debt, car loans and your income. Don’t set yourself up for this disappointment; get yourself pre-approved and certain about your financing. Then search with confidence.
Stay Conservative and Within Your Budget
Strapping yourself into a heavy mortgage payment can be a very stressful thing to do. Owning a home is expensive as it is with all the extra expenses that come with home ownership. You can’t call the landlord anymore to fix your toilet. Now you have to call the plumber and they charge an hourly rate and perhaps a trip expense fee and even maybe a gas fee to come to your home. With this and other unexpected expenses, play it safe and give yourself some room in your monthly budget to order pizza if you want without having to put it on your credit card.
Set Up A Home Maintenance Account
To be able to pay for extra expenses and what they’ll cost on a monthly basis, multiply your monthly mortgage payment by 5% to come up with a home maintenance expense. Put some portion of this money aside in a separate bank account and leave it alone. You might not need it for a year, but when the hot water heater blows in December just before the holidays and you have to replace it, you’ll have the money ready.
Read The Fine Print and Get Everything In Writing
Real estate contracts are written with some pretty boring legalese. But if they are not taken seriously they can cost you a significant amount of money if something goes wrong with your ability to get financing, or with the home etc. Take notice of the contingency clauses as they are there for you as a home buyer to make sure that you have a way to cancel the purchase contract should something go south with the deal.
Whatever you agree to do or not do or the seller agrees to do or not do, make sure that you get it written down and signed by you and the seller. If your real estate agent agrees to do something on your behalf, make sure that you get some sort of written agreement. It is hard to prove verbal agreements but written documents with valid signatures from you and the seller go a long way to keeping everything above board and all parties honest.
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