When you think costly purchases, what are the first things that come to mind?
A new car? Maybe a new couch? How about that cruise vacation you've been pining after for some time now?
But really, one of the biggest purchases you'll ever make- is a home. I say home, not 'house', because this will be your happy place, where you'll come home from work and feel a sense of relief as soon as you walk through the door. This is where is all starts... or I should I say ends?
No pressure, right?
It can seem daunting; trying to think of everything, considering location, schools, yard size, nearest town center and shopping... its endless.
Having gone through this adventure a couple times myself, I've gathered some pointers to help you prepare, or even follow along as you jump into home ownership!
FIRST TIME HOME BUYER GUIDE
1. FIND A LENDER
This may seem pre-emptive but trust me- it's crucial. If you are a member of a credit union or a bank that would be a great place to start. Reach out and start the conversation, they'll help go over your Debt-to-Income ratio, current mortgage rates, etc. If you already have a Realtor, ask them for referrals, he/she will usually have a go-to Lender who they trust and work with regularly.
2. PRE-QUALIFICATION VS. PRE-APPROVAL
Sounds pretty similar, right? They could mean the difference between an acceptance of offer and being rejected! Let me explain: Pre-qualification is not the same as pre-approval. Pre-qualification simply means that you've started the process with a lender, they have your general financial information and have given you a rough estimate of what you can afford.
Pre-approval means that a lender has gone in-depth into your financials, credit score, and debt and has given you a specific dollar amount.
This is significant is for two reasons:
A. You'll know exactly what homes you can afford and which ones may be out of range. There is nothing more tragic than finding a home you absolutely love, making an offer, getting excited - and then finding out you can't afford it [Your spouse will be a spicy mix of livid and heart broken= no bueno].
B. Let's say you make an offer and then find out you're in a multiple offer situation (which means more than one buyer is interested and making an offer on the house you want) the competing buyers have a Pre-qualification letter but YOU have a Pre-approval letter. Guess what? The sellers will be far more inclined to accept your offer knowing that your bank has already pre-approved you for the right amount and they're confident all will go more smoothly [In this instance, your wife will see you as the home buying champion!].
3. DETERMINING YOUR HOME CRITERIA
Think about what you need in your home, neighborhood, and area of town.
Neighborhood details to consider:
Drive time to work
Accessibility to highways and public transportation
Proximity to shopping, churches, day care facilities, recreation and entertainment
Reputation of area school systems
General House criteria to consider:
Single family home vs. Multiple family home
One-story vs. two-story
Spacious back yard vs. smaller, low-maintenance yard
How close to the neighbors are you?
Once you've gathered your list of wants vs. needs, prioritize. Prioritize what's most important to you and on what you're willing to give a little. From there, give your Realtor your list and they can start the search with you.
*Side note: Please, for the love of all things holy and real estate, do not use Zillow. Your Realtor/Agent can set you up on the MLS and you can search on there yourself, but Zillow gets its information from the MLS so their information is usually heavily delayed. This can really throw a wrench in your search because you may find a home (that you love love love!) but because Zillow is not up-to-date, it doesn't show that that specific home... is already under contract. Cue the tears!
4. FIND YOUR HOME + MAKE AN OFFER
Now you're ready to start seeing the homes you've narrowed down. I highly recommend you choose your top 5-7 and go see those first. Keep in mind that it takes time, there are instances when you'll walk and in say "This is it! The search is over!" but it doesn't always happen like that. This is a big investment, take your time and find your perfect space.
After you've decided on the one, you and your Realtor/Agent will go over comparative homes in the area and come to a decision on what you want to offer among other contractual specifics. After the offer is submitted- you wait to hear back. From here, a couple things can happen: the offer is accepted (with or without contingencies), the offer is refused or the Seller may come back with a Counter-offer. Your Realtor/Agent will help you navigate and negotiate through any of this situations and will work with you through it all.
You're offer has been accepted! Almost time to celebrate, but not quite yet! Your Realtor/Agent will help you schedule an Inspection and your Lender will schedule an Appraisal. After Inspection, you and your Realtor will discuss Repair Requests and the Lender will organize additional paperwork. Once all negotiations have been settles, repairs made and paperwork submitted/filed, you will all meet for closing, sign and get the keys!
Now the fun part, moving in! New blog post coming with tips and tricks on how to make moving go as smoothly as possible!
Hope this was all helpful, feel free to reach out if you have questions, would like more information or would love to talk about buying and/or selling a property!
Information credentials via watsonrealtycorp.com