If you’re looking to buy a home in the near future, you may understandably feel overwhelmed by the process. But if you’re prepared and know what to expect, the process can be smooth and stress-free. Plus, it doesn’t hurt if you have experienced Realtors® on your side to talk you through everything!
Here’s a quick overview to the home buying process.
Step 1: Come up With a Down Payment
The first step is to sit down and go over your finances to determine how much you have and how much of that you are willing to spend on a home. If you want to obtain a mortgage from a lender, you will need a down payment, ideally 20 percent of the home’s price to avoid PMI and other fees.
However, you can put down less with certain types of mortgages, such as VA loans.
Step 2: Obtain Your Credit Score
You will need a decent credit score to get a good interest rate. Your credit score is part of a detailed document that outlines how well you have paid off past debts in the past, such as for credit cards and student loans.
All lenders will check your score before deciding to lend you money. If your credit score is not where you want it to be, take steps immediately to improve it.
Step 3: Get Pre-Approved
Before you go house hunting, you will need a pre-approval from a lender. This is a document that tells your real estate agent and potential sellers how much you can afford. Essentially, it guarantees you’re creditworthy and are approved to buy a home.
Step 4: Find a Real Estate Agent
Especially when you’re a first-time home buyer, you need to partner with a trusted real estate agent who can help you find the right house, negotiate offers and explain all the steps along the way. If you try and tackle the process on your own, you will have to do a lot of work and running around, and you may miss deadlines and deals. You may even miss out on the home of your dreams because of your inexperience with the process.
Step 5: Start Shopping for a Home
Your real estate age will set you up with access to MLS listings that only show you homes within your price range and desired location, and that has all the amenities that you want. If you see something you like, simply tell your agent and he or she will take you to look at it.
Step 6: Make an Offer
This is where having a Realtor on your side can really come in handy. They can advise you on what’s a fair offer to extend, and when to make counter offers.
Step 7: Get a Home Inspection
Once your offer is accepted, your agent will schedule a home inspection, which will determine if there are any problems with the home, such as termites, cracked foundation, mold or asbestos. Most problems can be fixed, or the seller may give you more money off the selling price to fix the issues later.
Step 8: Get the Home Appraised
Even if you got pre-approved for a loan, the lender will still want to conduct a home appraisal to make sure it is a good investment.
Step 9: Attend the Closing
Closing, also known as settlement or escrow, brings together the buyer, seller, mortgage representative, and others – usually at the lawyer’s office. This is when you will sign all the paperwork, make payments to all parties, and receive the keys to your new home. The only thing left to do is move in!
Contact Berkshire Hathaway Premier Properties
The first thing you should do to learn more about what to expect during the home buying process is to contact the professionals at Berkshire Hathaway Premier Properties!