If you ask many first-time home buyers about the steps to buying a home, they may likely tell you to look at a home for sale first. Whenever home buyers make up their minds to buy dream home, they start looking for houses that are for sale and in a prime location.
However, this step is essential but there are other things you should do when looking to purchase a house. Even though it is not even the second or the third one to do. Buying a home is not like buying a furniture or a television. So, before you go for house hunting, here are 8 essential steps for home buys.
8 Steps To Buying A Home
1- Decide To Buy Dream Home
There are many reasons for home buys but wealth building is at the top of the list. We consider home ownership the best type of accidental investment most people make. But we believe that when you strategically invest in home buying then it becomes an intentional investment. It uplifts the foundation for a life of personal choice and financial security. There can be many solid reasons to support your decision to buy a dream home. Equity buildup, tax benefits and value appreciation are among the reasons anyone would want to invest in home buying.
You should make your decision to buy a property on solid reasoning or facts not fears. If you are living in a rental property, you can make up your mind to buy a house. There is never a bad time to buy the dream home. All you have to do is find the best real estate agent and make sure you have the financial resources to hold it for the long run.
You should know that a less-than-perfect credit score is not a hurdle in your way to buying a home. The best decision is to buy your first home sooner rather than waiting for all the downpayment you save.
2- Hire The Best Real Estate Agent
When you buy a house, there are dozens of separate individuals involved. This includes mortgage brokers, insurance assessors, inspectors, underwriters, bankers, researchers, escrow officers, appraisers, seller’s agents, buyers’ agents and many other individuals. These all play an important role in making decisions and actions throughout the process and getting house sales closed.
Therefore, it is the responsibility of your hired real estate agent to expertly connect with all these professionals involved and to support you as the advocate for you. Your real estate agent will educate you about the housing market in your desired area. He will analyze your needs and wants and guide you to homes that fit your budget and criteria. His overall responsibility is to guide you and handle the whole process of buying dream home.
3- Secure Financing With A Mortgage Lender
You might think of taking on a mortgage loan but still get double thoughts about it. Many first-time home buyers get confused about the mortgage pre-approval process. Some get nervous about making such large financial commitments. You just have to follow a few steps to know the process for securing a home loan.
Step 1
You have to choose a mortgage lender or any mortgage broker.
Step 2
Next, complete a mortgage application and get it pre-approved.
Step 3
You have to determine what monthly mortgage payments are the most suitable for you and select a loan option.
Step 4
After selecting the loan option, mortgage lenders will need you to submit an accepted purchase offer contract. Next, you will get the appraised value of the property and title commitment.
Step 5
Lastly, you will obtain funding on the closing date.
4- Find Your Home’s Location
Many first-time home buyers think that shopping for homes starts with just getting into the car and driving around the town. It is trying to some extent that hopping in the car to find the best location is exciting. However, it gets irritating when you keep on searching for weeks but still don’t get any useful leads. Therefore, searching for your home starts with assessing your wants, values, and needs, both for the short and long term.
You must consider all the possible factors like location, amenities, neighbourhood, and features. Photos of your prime location will help you evaluate your home options. When you visit dozens of houses, they can be mixed together. You might not remember which of the houses had the big closet you wanted.
5- Make an offer
When you start hunting for your dream home, you are just dreaming about your ideal house. Now at this stage, you are writing an offer, and you need to handle things like a businessperson. You must approach this process with a realistic perspective of your market for best home buys. The three basic compliments of an offer are terms, purchase price and contingencies.
The best price to offer must also reflect the true value of the house you want to buy. Your real estate partner will do market research for you and guide you to make a decision.
Here are some terms that fall under these categories in real estate offer:
Schedule
You will schedule events that have to happen before the closing.
Conveyances
These are the items that stay with the house when the seller hands them over to the new buyer.
Commissions
The real estate fee or commission, is for both the agent who works with the seller and the one who works with the buyer.
Closing costs
It is standard for buyers to pay their closing costs, but if you want to roll the costs into the home loans, you must write that into the contract.
Home warranty
This covers the replacement or repair of appliances and main systems. You can ask the seller to pay for this.
Earnest money
This helps you protect the sellers from backing off from the deal and make a statement about the seriousness of your offer.
6- Perform Due Diligence
When you buy a home, you cannot return it if something doesn’t work well or something breaks off. That is why a home inspection and homeowner insurance are crucial.
A home insurance policy protects you against any loss or damage to the property. Also, the liability in case someone gets an injury while on your property. The inspection of the property should reveal the secret issues a home might have so you know what you are paying for. Your major concern should be on structural damage and any big issues in the house.
7- The Closing
The final stage of your (home buys) process is the home’s worth confirmation by the lender. This stage includes appraisal, a survey, a title search, and a final check of your financial health and your credit report. Your real estate agent will keep you updated about the progress of your home buys.
You will have to stay in control of your finances, return all paperwork promptly, and conduct a walk-through at the end of your home buys. On closing day, you will sign documents to pay the seller and finalize your mortgage. You will have to transfer the title from the seller to you and make arrangements to legally record the transactions for public record.
8- Protect Your Investment
You have mostly spent a lot of time with your real estate agent and you would have got to know him well. There is no reason to lose touch with your agent just because the deal is closed. Your agent will still help you handle your first tax return as a homeowner. He will help your friends find a house for sale. moreover, he will keep track of your possessed home market value throughout the time.
Lastly,
After closely considering all the possibilities and following the steps, you will buy your dream home at the prime location. However, after purchase, you will have to maintain the house which takes a lot of toll. You must decorate your home according to the latest home decor trends as well. Also, perform routine maintenance on your home’s system. Most importantly, watch for signs of leaks, wear, and damage. Fix small problems in your house and keep it as good as you can.
