Buying your first home is an exciting experience unlike any other. I love reviewing the “Yellow Brick Road” to homeownership with my first time homebuyers! It is an excellent illustration that allows the client to visualize the path which they are about to embark upon. Many questions are answered and more arise simply by reviewing the illustration. It’s lots of fun to explain the process and discuss the various challenges and hurdles that inevitably present themselves.
If you’re thinking about buying your first home, you probably have some questions about what steps you’ll need to take.
These Are The 7 Critical Steps To Buying Your First House:
1. Research all of your options
The first step towards becoming a homeowner is to consider the lifestyle you want to achieve in your new home.
Take the time to research the individual neighborhoods where you can see yourself living. Don’t forget to focus on factors that will affect your home’s value and your quality of life, such as local school ratings, crime rates, and property taxes in the area.
Think about how your commute to work will be affected as well. Map out the route you’d be taking every day to see if you’re comfortable with the amount of time you’ll be spending on the road.
You should also learn about the local real estate market, and pay close attention to the prices of recently sold homes in the area.
This information will help you determine which neighborhoods fit within your budget and meet your needs.
Additionally, as you start thinking about your down payment, you can research mortgage programs to understand what your monthly payments will look like.
Don’t forget to budget for other expenses that may be new to you, like utilities, homeowners insurance, HOA fees, and the occasional unexpected home repair!
Once you’ve had some time to consider your budget and compare mortgage programs, get pre-approved so that you can make a more compelling offer.
2. Find a real estate agent who’s equipped to meet your needs
When you’re looking for your first home, working with a real estate agent can make the entire buying process much simpler. That being said, no two real estate agents are the same, and the best agent to work with will often depend heavily on the neighborhoods you’re most interested in looking at.
Make sure you know the right questions to ask when you’re looking for a real estate agent to represent you.
3. Start viewing homes for sale
Once your agent has a clear understanding of what you’re looking for in a home (and neighborhood), he or she can help you find houses for sale within your price range.
As you’re viewing these homes, you may want to write down notes about the properties so you can keep track of features that you did or didn’t like. Don’t be afraid to carefully inspect each home as you’re walking through; sellers are usually willing to negotiate when there’s an obvious need for repair work.
4. Make an offer
Once you’ve found a property you’re interested in pursuing, talk to your real estate agent about a negotiation strategy. He or she should be able to help you create a strategic offer based on the local market and the property’s estimated value.
If the seller doesn’t immediately accept your offer, don’t be discouraged! Trust your real estate agent’s advice, and don’t let your emotions get in the way. If you simply can’t come to an agreement with the seller, there’s no harm in walking away from the home.
Once your offer is accepted, you and the seller will then enter into a contract outlining any contingencies that must be addressed before the deal can close. Typically, most home sales are contingent on the buyer’s ability to secure financing and the results of the home inspection.
After you’ve deposited an earnest payment, the seller will then take the home off the market. Typically, this is followed by an option period, during which time you as a buyer reserve the right to terminate the contract.
5. Hire an inspector
The option period provides the perfect opportunity to have the house thoroughly inspected. If the home inspector uncovers significant problems, you can try to renegotiate the deal with the seller. If, at this time, you and the seller cannot reach an agreement, then you can terminate the contract and recoup your earnest money.
6. Get your mortgage loan approved
Before your loan can be approved, your lender will require an appraisal to determine the home’s value and prevent you from borrowing more than the home is worth.
Additionally, you will be required to obtain title insurance, which protects you as a homeowner from certain losses that could be incurred as a result of purchasing the home. Your title commitment paperwork will outline the specific coverage provided by your title insurance.
7. Close on your new home
If your contract required the seller to make repairs, these will be taken care of after your loan has been approved. If you’re buying new construction, then a final inspection is completed at this time instead.
Next, you’ll hire a surveyor to measure the land and identify the legal boundaries of the property. This will help you and your new neighbors avoid any confusion over property lines.
After these steps have been completed, you can close the deal and move into your new home!
Need more information about how to buy your first home?
Get the answers to all of your questions! Contact me today to reserve your spot at the Better Homes And Gardens Home Buying Seminar on Saturday, May 19.