The Dos and Don’ts When Buying a Home For Sale
Buying a home has many moving parts to the process. Before you get yourself excited by imagining all of the entertaining you will be doing with friends and family, you will want to make sure you are best prepared for making this huge accomplishment. Here are a bunch of things that you will want to both do and avoid while you get yourself ready and well positioned.
What To Do
Check your credit – Your credit plays a large role in qualifying for a mortgage. Make sure you check yours to know your score and check for accuracy.
Get pre approved – Contact a lender to get pre approved for a home loan. See what you can ultimately afford. You can shop lenders for fees that are charged as well.
Contact an agent – Contact a professional real estate agent such as myself to learn about local market conditions and to ultimately help you find a home in an area of your choice.
Decide on an area – Chances are there may be more than one neighborhood that will work for you. Attend some open houses and drive around at various times of day to really get an idea of what an area is like.
Preserve finances – It is important to maintain your financial status during the whole house purchase process for home loan qualification purposes. Avoid new jobs, opening new accounts or large purchases at this time. Give some thought as well to how you will budget for future home improvements during this time too.
Locate a home – Focus on a home’s potential rather than adhering to a strict checklist. Especially during times of slim inventory you want to be open to as many options as possible. Walls can be painted and rooms can be updated so long as the core is something you can work with.
Shop for insurance – Insurance is something you can shop around for and check for different rates, seek bundled discounts or see if your home has qualifying status for discounts like an alarm system or the like.
Pay attention to security – A lot of personal information is exchanged during a home purchase. Be mindful of who you are providing your personal details to including social security numbers, bank info and the like. Be sure to work only with trusted and reputable professionals.
Review closing docs – Your closing documents are extremely important as they are what binds your deal. When you are given your final versions a few days before closing, be sure to review thoroughly and check for accuracy, correct spelling of names, etc and make sure amounts are what they should be.
What Not To Do
Search before pre approved – Don’t get yourself excited by looking at home before you know if you can afford them. Only a lender will be able to realistically tell you what you can spend.
Don’t wait to save 20% for a downpayment – Sure, 20% is ideal to put down to avoid paying mortgage insurance but there are many loan programs that allow for much less, some as little as 3.5%!
Don’t get emotional – Try to keep to business so you don’t regret making any rash decisions. Also, it is not uncommon to get outbid on a home these days too so keep your chin up!
Don’t skip your research – Don’t just go by what a listing description may say – be sure to view homes in person and certainly follow up with a home inspection on a home you submit an offer on. Also, don’t just go by simple mortgage calculators for estimating payments. Not all include everything such as an HOA due, extra insurance needed or the like.
Don’t forget about closing costs – Many times buyers are so focused on saving for a down payment that they forget about closing costs – and those can be substantial too! Expect this to fall somewhere between 2 and 5% of the purchase price.