Purchasing a home is an important investments. It is usually a pivotal moment in the lives of every first-time homeowner or experienced home shopper, and it's an achievement to be proud of. But between the dream of owning a home and the moment you put the key into the door for the first time, there tends to be a great deal of confusion, doubt, frustration, and questions. How do you get started? What is the best way to bridge the gap between dream and reality? The journey to home ownership looks different for everyone, but here are ten major steps that most people take when purchasing a home. If you follow these steps with the help of a local real estate agent, you'll be on the path to home ownership in no time and the market is competitive — every advantage helps.
Know What You Can Afford: Keep track of your finances and make sure you have a realistic understanding of what you can afford. It's important to know what your credit score is and to find ways of improving it if need be. The higher your credit score, the easier it will be to secure a home loan. It's important to have realistic expectations about how much you'll need for a down payment, as well. For most home buyers, that number will fall between five and 20 percent of the purchase price.
Do Your Research: Research the real estate markets in the popular neighbourhoods, you want to live should begin long before you're ready to buy. Keep an eye on pricing, how long homes tend to stay on the market if prices tend to rise or fall sharply during certain times of the year, and so on. It's never too early to consult with a local real estate agent. An experienced agent can help you determine which data is most applicable to you and can help you through both the planning and purchasing phases.
Get Pre-approved: As you get closer to seriously shopping for and purchasing a home, you should go through the home loan pre-approval process. You can probably arrive at a decent estimate of how much you can afford by conducting some basic research and calculations. However, going through the pre-approval process gives you a clear idea of how much you can be approved for. Getting pre-approved can also help you when you reach the negotiation phase. You'll want to collect basic financial information like your income, debts, and assets before you go to speak with your lender about pre-approval.
Itemize Your Priorities: Get a solid grasp on what your must-haves, nice-to-haves, and deal breakers are. Prioritize the features that you consider essential. Keep your budget in mind while you're creating this list, so you stay on track and create a list that is realistic and achievable. While it's unlikely that you'll be able to find a home that includes every single feature you desire, it's reasonable to expect that you'll find one capable of meeting your must-haves and a few nice-to-haves, as well, assuming you've created a realistic list. That helipad tennis court probably isn't going to happen, though.
Secure a Real Estate Agent: If you haven't already, now is the time to find a real estate agent to help you through the process. A local real estate agent can help you successfully navigate the home buying process. You can discuss your priorities and pre-approval status and start coming up with a list of options. Real estate agents tend to have deep, in-depth knowledge about the communities in which they work and which ones would be most beneficial to invest your money in, so you'll be able to get the inside scoop on what your best options are. Your agent can also help you determine an affordable solution that meets your goals and can even help you negotiate your offer, so you have the best chance of getting approved.
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Make the Offer: Once you find the home you'd like to purchase, it's time to make the offer. Work with your real estate agent to create an offer that's reasonable and affordable. The negotiation process can be challenging, but being pre-approved and having an agent on your side can make it easier. It's usually advised that you not submit an offer that is too low. Doing so can often end negotiations before they even begin. However, it's important that when it comes to negotiating you always defer to the advice of your real estate agent and the data you've collected along the way.
Inspect the Property: Property inspection is a critical part of the home-buying process and not one you should ever forego. It's incredibly important that you complete any inspections that need to be done before you secure a loan. Inspections can protect you as the home buyer by making sure that the sellers have been honest about the condition of the property. If the inspection process uncovers areas of concern and you find out that some major work needs to be done, especially if you weren't informed about this prior to making an offer, the home seller is usually responsible for covering the costs of those repairs. If you wait to inspect the property until after you're the owner, any issues that come up will likely be your responsibility. Be sure to inspect the property thoroughly before making any financial commitments.
Secure the Loan: Once the inspection process is complete and all necessary repairs have been made, it's time to get the property appraised. Once the appraisal comes in, you can take that information to your financial institution or lender and get your home loan.
Complete the Paperwork: After you've obtained the necessary funds to purchase the home, you can go ahead and complete all the required paperwork. If you went through the pre-approval process, your pre-approved status will make this part of the process go much more quickly. Even so, you'll still have to be patient while you wait for the paperwork to be processed.
Move In: Congratulations! You're a homeowner. Now that everything is done, you can move in and begin your life in your new home.
The path to home ownership can be long and, at times, it can be frustrating. However, working with the right real estate agent and taking the time to complete each step of the process will help ensure that your home buying experience is successful. Buying a home is the largest purchase you're likely to make in your life, so it makes sense that a great deal of leg work, research, and time should go into the process. However, once everything is settled and you've moved into your new home, you'll have years of happiness ahead of you that will make it all worth it.