Buying a home is the largest investment most people will make in their lives. It is an exciting and exhilarating experience, especially if you have experts to help you along the way. Here are a few things you'll need to know.
The first step in the home-buying process is making some key decisions. Answering important questions early, like how much home you can afford, what type of home you want to buy and other key considerations, will help keep the process smooth later on.
On the journey to homeownership, this helpful guide will serve as your roadmap with information to make you feel confident and assured in your decisions. And if you ever find yourself feeling lost, we're here to offer further guidance.
The home-buying process begins with some key considerations that will ensure that you start this journey on the right foot.
While buying a home may seem like it is always the right decision, it might not necessarily be the case for everyone. For some, renting is the more prudent option. Once you compare buying vs. renting, you are ready to make the best decision for your current situation.
Once you have decided that purchasing a home is right for you, you’ll next want to think about how much home you want to own. Knowing what you can afford in a home will help focus your search. How much space will you need? How much space can you afford? Answering these questions honestly will help you find the right home for your needs.
Now that you know what you can afford, you can determine what type of home best fits your needs. Consider the differences between a single-family home, a condo and other housing options. This will help save you time and frustration in your search.
The home-buying process is a major investment of both time and money. Working with the right loan professionals will make the process infinitely easier on your peace of mind and your bottom line. The key is to put together a team that you trust who will have your best interests at heart.
You have decided that you are ready to begin your home-buying journey. There are a few steps to take that will ensure that you will be getting the right mortgage to fit your needs.
You've done your homework and reached the informed decision that buying a home is the right choice for you. You know how much you can afford and have even narrowed down what type of home you want to buy. Now it is time to start the mortgage process. We're on your team to help guide you.
Having a set budget is key. Answering a few questions before you begin looking will help you find the best loan option to fit your budget. Do you have a down payment? What is your income-to-debt ratio? What is your credit score? These basic answers will go a long way to making informed decisions. You can find more about budgeting for a home here.
You will need to figure out your monthly payments and how much you can comfortably afford. Your monthly mortgage payment consists of Principal, Interest, Taxes and Insurance, also known as PITI.
One of the biggest concerns for homeowners is their mortgage interest rate. That’s because it directly affects the monthly payments for the life of the loan. Because of this, home buyers search for steps they can take to obtain the lowest rate available.
Getting prequalified for a home loan is a great way to guide you on your home search. What is prequalification? What are the benefits? Is it right for you? We can help you answer all of these questions and others.
Getting prequalified for a loan before you start looking serves as the best roadmap for your home-buying journey.
Prequalification is an estimate of what you might be able to borrow. You will provide your lender with information about your income and assets, and sometimes will submit to a credit check. Your lender then gives you an estimate of your loan amount and loan program.
Prequalification is offered by most lenders at no cost.The process is not comprehensive and therefore is not guaranteed, nor is it considered any type of loan commitment. It simply shows that you’ve approached a lender who was serious about helping you determine what you can afford and will walk you through the process. A prequalification is not an approval of credit, and does not signify that underwriting requirements have been met.
Once you have been prequalified for a home loan, you have a great idea how much home you can afford. In other words, you have the boundaries you need to begin house hunting.
Before you start looking at houses, make a wish list for the qualities you are looking for. If you choose to work with a licensed real estate professional, this will help narrow your search.
Finding the right neighborhood is often just as important as finding the right house. When considering a neighborhood, ask yourself some key questions. Is it near your office and areas of the city that are important to you and your family? Is it in the school district you desire for your children? Does the neighborhood appear to be a good fit for you and your family today and tomorrow?
There are several types of homes out there, each one providing different options in terms of space, responsibilities, upkeep and ownership. Consider all the differing factors that would make a single-family home, a condominium or a townhome the best choice for you.
What do you need in a home and what do you want in a home? Would you like a one-story or two-story home? How many bedrooms and bathrooms would you need? Would you like a home office? What type of backyard would you like? Consider all the different aspects and prioritize the features of the home you’d like to have.
You’ve found your dream home. What comes next? We can let you know what to expect when it comes to actually buying a home, from extending an offer through closing. Our experts are always here to be your guide.
Purchasing a home is a transaction that involves heavy negotiations. A real estate professional can be a valuable resource to have on your side as you determine the appropriate initial offer to extend. During this part of the process, you’ll want to consider the following:
To add extra weight to your offer, you’ll want to provide the prequalification letter from your loan officer. Sellers obviously prefer an offer with financial security.
Make sure all of your negotiations are in writing. This will provide a record of deals and decisions made as well as help avoid any misunderstandings.
You’ll want to have earnest or “good faith” money ready for a deposit. While the amount varies depending on your location, all of it will be placed into an escrow account until the purchase transaction is complete.
Once the seller has accepted your offer, here’s what you’ll need now that you’re in the final stretch:
Money has now officially changed hands, and you’re getting closer to the end. You will now need to finalize the purchase agreement, a legally binding contract between the buyer and the seller of the property that outlines all terms and features of the final transaction. This can include:
Because every home transaction is different, these contracts are not exactly uniform. A real estate professional, a title company or an attorney may assist in the negotiations and execution of a purchase contract; this is dependent on the state in which the transaction is being conducted.