Buying a home can be an exciting as well as a stressful time, especially for the first time homebuyers. Proper preparation and education before beginning a search for a dream home can help remove some anxiety from the home-buying experience. Here are some tips aimed at making the home-buying experience a smooth, efficient, and stress-free one:
- Build home equity
- Receive income tax benefits
- Social status
- Avoid rent increases and canceled leases
- Enjoy potential price appreciation
Knowing your reasons(s) for buying a home, and how homeownership fits into your overall life goals, will make you more likely to stick with the home through thick and thin.
- Financial Stability and Budgeting: Assess your earning potential and calculate your monthly expenditures to make sure you will be able to pay your mortgage, taxes, insurance, HOA, repairs, maintenance, utilities, as well as for emergencies, every month for several years.
- Risks: Due to the ever-changing market, a real estate investment does not always increase in value. Your property value may increase or decrease over time.
- Commitment: When you own a home, it is harder to pick up and move with short notice; you are obligated to sell the home first.
Having considered all these beforehand makes you a careful, confident, and committed homebuyer.
- Check your credit report to ensure the accuracy of the items reported on it.
- Take necessary steps to improve your credit score.
- Hold off on large credit purchases.
- Save and set aside money for a down payment in a verifiable account.
- Document your rental history for at least the last 12 months.
- Organize documents needed for mortgage pre-approval (paystubs, W-2s, tax returns, bank statements, etc.).
Getting your financial house in order beforehand shows your seriousness towards buying a home to your real estate agent and mortgage lender.
- Find a real estate agent
- Get pre-approved for a mortgage
- Find a home
- Write an offer
- Inspect the house
- Negotiate repairs
- Shop for a loan
- Shop for homeowner’s insurance
- Sign papers
The more you educate yourself about the home-buying process beforehand, the less stressful it will be, and the more likely you will be to get the house you want for a price you can afford. To learn more about home-buying process, visit www.HUD.gov
- Recommend a mortgage broker or lender for mortgage pre-approval.
- Help crystallize the type, features, and location of the home you want to live in.
- Facilitate your home search, schedule and accompany you on site visits, explain pros and cons of the homes you like, etc.
- Help you write an offer and negotiate price, contingencies, terms, and repairs.
- Coordinate with various parties involved in the transaction and handle all the paperwork.
It doesn’t cost the buyer anything to use a real estate agent – they’re compensated from the commission paid by the seller of the house.
Good luck, and we hope you find your dream home soon!