Buying a home doesn’t have to be a scary process if you take the time to get informed about what to expect. Knowing what steps to take down the road ahead will keep you from stressing about what’s to come. Check out these six steps to buying a house before you reach out to a real estate agent.
Step 1 – Check Credit
According to The Fair Credit Reporting Act, you’re permitted to get one free copy of your credit report per year from the top three reporting agencies. Get your copy as soon as possible and closely inspect it for errors. Your credit report plays a huge role in determining your eligibility to receive a home mortgage loan. Pay off any delinquent accounts as soon as possible. The earlier you get your credit report in shape, the better it will look to potential lenders. Avoid making any large purchases now that require financing. Adding more monthly payment accounts onto your credit report could negatively affect your income to debt ratio, making it harder to get a good loan rate.
Step 2 – Save Money
Acquiring a home mortgage loan will help you avoid paying cash out of pocket for price of the home. You will have other expenses pop up that require payment from your personal funds. You pay the down payment, closing costs, and moving expenses out of pocket. It’s good to have about 20 percent of what a home’s asking price will be saved up for your down payment. Closing costs will come in between 2 to 8 percent of the home’s asking price. It’s best to have extra money in your savings than to be left scrambling for a way to cover expenses down the road.
Step 3 – Find a Real Estate Agent
A good real estate agent will make the experience of buying a home as painless and stress-free as possible. Look for an agent who has your best interest at heart instead of only trying to boost their sales numbers. Meet with the entire team and discuss how they will be working towards finding you the perfect home. A real estate agent who can give you honest, straight-forward advice regarding your personal situation will prove to be invaluable in the long run.
Step 4 – Apply for Home Mortgage Pre-Approval
When looking through listings for potential homes, you may find yourself drawn to houses in a particular price range. Can you afford the asking price? Applying for a home mortgage pre-approval is a good way to help you determine what your actual home buying budget is. Knowing what your limits are before you start searching will prevent you from getting your heart set on a property that falls out of your means.
Step 5 – Place an Offer
Choosing the right price to put as your offer can be tricky. You don’t want to offend the seller, but you also don’t want to overpay for a property. You want to grab their attention, let them know you’re serious and beat out other potential offers. Listen to the wisdom and advice of your real estate agent at this point to get the best result possible. It may take more than one try, but your agent will be working to get you the best price for your dream home as efficiently as possible.
Step 6 – Closing Time When Buying a House
Once the seller accepts the offer, the mortgage lender will order several inspections and an appraisal. They perform a title search to make sure there are no outstanding liens or other problems. You will be responsible for paying closing costs and signing final pieces of paperwork on closing day. Closing day is an exciting time because it means you’ve successfully purchased a home. You hold the keys to the property in your hands.
Your real estate agent is the best source of information about the local community and real estate topics. Give The Scott Loper Team a call today at 267-446-3084 to learn more about local areas, discuss selling a house, or tour available homes for sale.