Making the decision to purchase a home can be intimidating to some, mostly because you are entering into a market you know absolutely nothing about. Thus, things seems simple when you watch the HGTV show House Hunters where all you see is clients view three homes, choose the one they like, make an offer, seller accepts then boom, you move in.
Granted that is somewhat how the process goes, but it don't clearly express how buyers officially got to that point of purchasing. Choosing to buy a home is one of the biggest transactions you will ever make, and here are a few things you MUST consider in order to have smooth successful process, therefor, you want to go into this journey well educated on what it takes to be become a homeowner.
Are you financially prepared?
No one wants to be house poor and it usually takes a while to save money in order to get to a point where you are financially comfortable. If you know that becoming a homeowner is in your future then it’s vital that you start saving early. You can open a separate account or use your savings account from your current bank. It’s best to save at least 8 months to a year worth of what your potential mortgage should be, plus utilities.
There are a number of fees you need to consider adding in your savings process including principal and interest, utilities, inspection, appraisal, furniture, food, basic cosmetic repairs, down payment and closing costs as well as other personal bills such as car payments/insurance, phone cable/TV and internet. If you have saved at least $20,000 you then will decrease the risk of falling behind in emergency situations like an unexpected job lose or even adding an addition to your family.
Getting Pre Approved
Another important factor in starting your journey in purchasing a home is to have your finances in order by paying off any debt that may affect your credit. Nowadays it’s even more difficult for people to get qualified for any kind of loan who have bad credit. One of the things lenders look at is how much debt you owe, which ultimately determines whether you are able to get qualified. Check your credit; you should know all three of your FICO scores from the credit bureaus. View all items on your report so you’ll know exactly what to work on beforehand.
Check with your bank to find out all the necessary requirements. Note that your lender of choice will look for any outstanding debt, credit history and reports along with bank statements, paystubs and at least 2/3 years tax returns. You definitely have a good chance on getting approved if you have proven to have a good history when it comes to paying bills and loans on time and being financial responsible.
Shop around when choosing a professional for assistance, most lenders have different mortgage products, fees, interest rates and can also help with finding you 1st time home buyers programs that help with grants and closing costs. You want to find a lender which offers you the best package that fits your needs. Talk to you friends, family and trusted colleagues who have been down this road before, they might be able to refer you.
Finding the Right Agent
Let’s face it, there are agents just about on every corner nowadays however not every agent will meet your needs. This is another process where you will have to do your homework. Being as though the home buying process is already stressful and overwhelming enough, so you will want to find an agent who is flexible, considerate and patient no matter what situation comes into play. Some agents are pushy and aggressive and will try to rush you into choosing a place, grab their commission and run. You need an agent who’s going to work hard and take their time in walking you through this journey. There are a lot of great professional agents out here and you don’t have to settle on the first one you run across. Take your time and talk to a few of them and you will find one that you will automatically connect with.
