There is a lot to consider when you decide to buy a home, especially if it’s your first. How much home can you afford? What kind of loan should you choose? Which neighborhoods are both affordable and a good investment? These are just a few of the questions you’ll be asking yourself. But with an experienced agent to help you, you’ll get the guidance you need to come up with the right answers— and a home you love.
First things first
Before you start shopping, you need to find out how much home you can afford to buy. Your agent can refer you to a loan officer who will help you determine how much of a down payment you can manage, as well as the monthly payment, taxes and insurance costs. Your lender can then prequalify you for a dollar amount, which can help you focus your search. You can also get a quick, rough estimate of monthly mortgage costs from your agent.
Create a wish list
Once you know your price range, talk to your agent about the home features you need and the ones you’d prefer. The former might include number of bedrooms or a suitable space for a home office, while the latter might include hardwood floors or a pantry. By clearly communicating your needs and preferences, you can help your agent narrow down the selection and avoid wasting your time.
Research Several Neighborhoods
Be sure to talk to your agent about what you’re looking for in a neighborhood. Are property values your highest priority? Great schools? A short commute? Small-town atmosphere? Big-city amenities? Your agent will try to narrow down the affordable neighborhoods that fit your criteria. Then you can either explore them with your agent or get a sense of each neighborhood on your own.
Interviewing Mortgage Advisors for Your Loan
There are many different loan programs to choose from. You’ll want to find one that offers you the best terms for your current situation and future plans. Your agent can give you the names of several mortgage specialists who can review your options with you and help you determine which loan is the most advantageous. Once you’re approved for a loan, sellers will consider you a more qualified prospective buyer.
Determining Your Offer Price, Terms & Conditions
You’ve finally found the right house in the right neighborhood. It fits your practical needs, has potential and just feels right. So how do you ensure that you keep the price as affordable as possible? Your agent has the expertise to help you make the right offer. He or she knows what comparable houses are selling for, how long they’ve been on the market, and whether or not the asking price for the home you want is fair. Your agent can also offer excellent advice when it comes to making a counteroffer.
Presenting Your Offer To The Seller
Once you’ve found the home you want , you give the seller an earnest-money deposit. Your agent draws up a purchase and sale agreement; it’s the contract that outlines the details of the property transfer from the seller to you. This contract is typically contingent on the home passing a structural inspection and you obtaining approval for financing.
What’s covered in an inspection?
This professional third-party report reviews the condition of the home, including:
* Cooling and heating systems
* Interior plumbing
* Electrical system
* Roof, attic and visible insulation
* Walls, ceilings, floors, windows and doors
* Foundation, basement and visible structure
* Any indication of leakage or wood rot
The inspection lets you know if the house has any major “issues” and how well it’s been maintained. Remember, no house is perfect. If the inspection uncovers some problems, your agent can help you determine whether to have the seller cover the costs or renegotiate the price.
When the inspection is concluded and any loose ends resolved, you “close” on the home. Closing is when you and the seller sign all the papers, you pay your share of the settlement fees, and the documents are recorded. Your agent will be happy to answer any questions throughout this complex process.
Home Sweet Home
When you buy a home, you get more than just a place to live. You get the satisfaction of having a place that is truly yours, one that reflects your style and provides a comfortable setting for you and your family. Buying a home also gives you a substantial annual tax deduction and a way to build wealth over the years.