Now that you have made the decision to purchase property, what is next? Buying your first home can be a daunting task and most of us don’t know where to begin. To help simplify the process for you, here are the ten laid out steps to buying your first home.
Step 1: Begin Your Research Early
If you have a timeframe by which you would like to move, it is best to start your research as soon as you can. You can begin your research by searching websites, newspapers, and magazines that have real estate listings. Also, drive around the neighborhood you are interested in living in to get a feel for it. Make note of any homes you see that have a for sale sign on them. Taking to professional realty executives can also be a good idea. For example, if you are based in Saskatoon, then check out these Realty Executives Saskatoon.
Step 2: How Much You Can Afford?
Make the determination of how much you can afford by creating a mock budget that includes all of your current expenses. Consider costs such as homeowners insurance, property taxes, and upkeep costs such as landscaping that is included when you rent. Lenders prefer that you look for homes that cost no more than three to five times your yearly household income.
Step 3: Get Loan Prequalified
Before you start the actual search for a home, you should get prequalified for a mortgage loan so that you know how much you can actually spend. To get prequalified, provide your financial information to your mortgage banker which includes your income and the amount of savings and investments you have.
Step 4: Choose a Real Estate Agent
Finding the real estate agent that best fits you and your needs is a crucial step. For some, it may need to come after step one. As a first-time buyer, you need someone that will listen and advocate for you. Your real estate agent can provide you with information on homes and neighborhoods. Their experience with the home buying process and negotiating skills will extremely valuable to you. For more information on how a real estate can assist you, visit www.homebuyersusa.com.
Step 5: Start Shopping Homes and Make an Offer
Now that you have your real estate agent and have been prequalified, it is now time to start looking at homes in your price range. Take notes of pros and cons for each house you view. Another great tip is to go back to the neighborhood at various times of the day such as the evening time, so you can get the most accurate assessment of the area. Once you have narrowed down the search, have your agent submit an offer on your behalf.
Step 6: Get a Home Inspection
Getting the home inspected is a mandatory step in the buying process. Purchase offers are contingent on the home inspection. During the home inspection, a third party will of the check for signs of structural damage, termite infestations, any major plumbing issues and anything else that may need fixing. Your real estate agent will assist in having the home inspection completed within a few days of your offer being accepted by the seller. Having the home inspection legally protects you from being “stuck” with a home that needs undisclosed repairs. If inconsistencies are discovered, you can renegotiate your offer or withdraw it without penalty.
Step 7: Select Your Loan
Every buyer has a preference when selecting their mortgage. Some things to keep in mind include keeping your monthly payments as low as possible and that the payment amount never increases. Your lender will help you select the loan that will be best for your financial situation.
Step 8: Have the Home Appraised
You are almost done. One of the final steps is to get the property appraised. Your lender will arrange for an appraiser to provide a separate, independent estimate of the value of the house. So that there is no conflict of interest, the appraiser is a part of a third-party company. The appraisal will inform all the necessary parties involved whether you are paying a fair market price for the home.
Step 9: Coordinate the Paperwork
There is a lot of paperwork that is involved when buying a house. Your lender and agent will have the title company (that they usually work with) handle all of the paperwork for you.
Step 10: Close the Sale
You made it, the day is finally here: closing day. At the closing of the purchase, you sign all of the paperwork necessary including your loan documents. On average it takes two-three days for your loan to be funded after the paperwork is returned to the lender.