Buying a home is a monumental purchase. It might seem intimidating to take the first step, but these easy DO’s and DON’Ts will make sure you’re headed in the right direction.
If you’re a real estate agent, be sure to add this list (or one like it) to the list of buyer resources on your agent website. Online prospects will appreciate the free advice!
Know your credit score.
Check your credit score before beginning the home buying process so you know where you stand. The better your credit, the better the terms of your loan. If your score is looking a little low, you might want to spend some time trying to raise your number before meeting with a mortgage specialist.
Investigate programs for buyers in your area.
Many cities and workplaces offer programs to build their communities by helping first-time buyers. Check with your employer or local real estate association. They can point you in the right direction!
Get preapproved for a loan.
Make an appointment with a mortgage specialist to get preapproved for a home loan. Preapproval is a written guarantee by a lender or mortgage broker to grant you a loan up to a specified amount. Being preapproved also means that you will have more pull than a competing buyer who is only prequalified.
Learn more about local neighbourhoods.
Explore the neighbourhoods in your city in person and online. A lot of online real estate search websites, like Point2 Homes, will have information about the demographics and walkability about different communities in your area.
Interview real estate agents to find the right fit.
Ask your friends and family and search online to find your real estate agent. You may end up interviewing several before you find one with the expertise and communication style you’re looking for. A good agent will also be interviewing you, so keep your ears out for questions like these.
Identify your wants vs your needs.
Knowing the difference between what you really need and what you actually just want will help you compromise and stay on budget. You may need a certain number of bedrooms, but you want an open plan kitchen.
If you’re hoping to secure a mortgage in the next 6-12 months, job stability is key! Stay in your present position until your purchase is closed, if possible. If you do get offered a job that pays more, you can probably still get your loan approved, but be warned that you will have to jump through more hoops!
Make large purchases.
Large purchases – like buying a new car or lots of furniture – can affect your credit and set off red flags for lenders who worry you won’t have money left when you need it. We advise you to wait to make substantial buys until after you move into your new home.
Get attached to the first house you see.
It’s easy to do. You fall in love with the first house you place an offer on, and then are heartbroken when someone else gets it. So many factors are involved in a successful real estate contract. Talk to your agent about your local market so you have realistic expectations from the get go.
Miss an opportunity to negotiate.
First-time buyers don’t usually know the many different kinds of negotiation that can take place before escrow closes. In addition to price, you may be able to negotiate for repairs, a new paint job or an extended move-in/out window. The agent you choose will go to bat for you, so be sure to pick a good one!
Skip a home inspection.
Never skip a home inspection on your first home. You want to know exactly what your hard-earned cash is buying before you buy it, after all! Learn more about home inspections and read about 14 common home problems to be on the lookout for.
Buying a home can be a long process, but it is rewarding in the end! Don’t give up if you don’t find what you’re looking for right away. New houses come on the market all the time.