Real Estate Tips for a First-Time Home Buyers
New car smell has nothing on the feeling you get when unlocking your home’s front door for the first time. But the process of reaching that euphoric moment?
You ready to live the dream? Here we go.
Do Your Homework
Oh sure, everybody wants to jump right into open houses. But before you even set foot into a foyer, you should identify your list of “musts” and “wants.” This list is an inventory of priorities for your search. And there’s so much to decide: Price, housing type, neighborhood, and school district — just to name a few.
Find a Great Agent
Your relationship with your real estate agent is the foundation of the home-buying process. (And your agent = your rock.) He or she is the first expert you’ll meet on your journey, and the one you’ll rely on most. That’s why it’s important to interview agents and find the agent who’s right for your specific needs.
Choose a Lender
Once you’ve found your agent (AKA, your new best friend), ask him or her to recommend one or two mortgage lenders. This is another big step, as you’ll be working with your lender closely throughout the home-buying process. It’s important you get this right. A lender can make or break a deal so choosing a good one is crucial.
Pick a Loan (It’s Not So Bad)
Once you’ve decided on a lender (or mortgage broker), you’ll work with your loan agent to determine which mortgage is right for you. You’ll consider the percentage of your income you want to spend on your new house, and you’ll provide the lender with paperwork showing proof of income, employment status, and other important financials. If all goes well (fingers crossed) you’ll be pre-approved for a loan at a certain amount. (Sweet.) You’ll need the pre-approval before you can determine what price you can spend on a home, not to mention a seller will not accept an offer without a pre-approval.
Now that you have both an agent who knows your housing preferences and a budget — and a lender to finance a house within that budget — it’s time to get serious about viewing homes. Your agent will provide listings you may like based on your parameters (price range, ZIP codes, features), and will also help you determine the quality of listings you find online. Then comes the fun part: Private showings with your Realtor will give you the unique opportunity to evaluate properties in a way you can’t online.
Make an Offer
Once you find the home you want to buy, you’ll work with your agent to craft an offer that not only specifies the price you’re willing to pay but also the proposed settlement date and contingencies — other conditions that must be agreed upon by both parties, such as giving you the ability to do a home inspection, timelines and who pays for what.
Negotiate, Negotiate, Negotiate
Making an offer can feel like an emotional precipice, almost like asking someone out on a date. Do they like me? Am I good enough? Will they say yes? It’s stressful! Some home sellers simply accept the best offer they receive, but many sellers make a counteroffer. If that happens, it’s up to you to decide whether you want your agent to negotiate with the seller or walk away. This is an area where your agent can provide real value by using their expert negotiating skills to haggle on your behalf and nab you the best deal.
Get the Place Inspected
If your offer is accepted, then you’ll sign a contract. Most sales contracts include a home inspection contingency, which means you’ll hire a licensed or certified home inspector to inspect the home for needed repairs, this where your agent will know what repairs to ask for, if any, credits or maybe the home is being sold “as is” and seller is not doing repairs. If the house is not up to the standards you were expecting, this is an opportunity to walk away or move forward to the next phase of your contact, the appraisal.
Ace the Appraisal
When you offer to buy a home, your lender will need to have the home appraised to make sure the property value is enough to cover the mortgage. If the home appraises close to the agreed-upon purchase price, you’re one step closer to settlement — but a low appraisal can add a wrinkle. This may be an opportunity for your Realtor to negotiate.
Close the Deal
The last stage of the home-buying process is settlement, or closing. This is when you sign the final ownership and insurance paperwork and make this whole thing official. There’s some prep work to take care of first.
When it’s all said and done — break out the rosé. You’ll have the keys to your new home!