Buying A House - Where Do I Start?

So, You want to buy a house.. Now What?
Buying a house for the first time, or the tenth time, can be overwhelming.  Here are the top things to keep in mind when considering your purchase..
 
1. Be financially ready.
This step can entail a lot of things, so let’s break that down. Buying a house costs money (who knew!) and that goes beyond the price of the home. You want to make sure you have

• Enough money for a downpayment

This amount can vary depending on your type of loan, but most loans require at least
3.5% down

• Enough money for closing costs and fees associated with the purchase

You should estimate that closing costs will be about 3-4% of the sales price as the buyer, and this can include title insurance, fees from the attorney or title company, etc. You can work with your realtor to get a closing cost credit, when necessary

• A credit score that ideally is above 640

Try using a free credit report service online such as:  annualcreditreport.com  in order to see what your score is. There are some things you can work on to improve that score before starting the buying process, which will put you in a better position

• Some money left over because, you know, you have to live!
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How do you know if you are financially ready? That leads to step two..
2. Talk to a lender or mortgage officer and get preapproved.

• This is a super important step because you don’t know what you can afford if you aren’t preapproved to buy. During this process, you can find ways to improve your score, determine which type of loan is best for your situation, and really start understanding the costs associated with buying.
• If you have a bank you love, you can talk to them about a mortgage, or ask your real estate agent for referrals in order to find someone who can work with you and make the process as stress-free as possible. We get no kickbacks for referring people, we just want you to be in good hands.
  
  

Which leads to number three…
3. Find a Good Realtor to Work With
This is NO COST to you, but will be helpful for sure. Realtors offer professional representation, help negotiating, and many other benefits to you throughout the process. Watch our other video on why using a realtor benefits you, as a buyer, here.

4. Find Your Dream House!
Now.. the home search begins! Visit houses with your agent after fully understanding your budget and what you want to spend. Tour the homes, ask questions, even take videos so you remember what you liked! If you’re buying from out of state, your agent can go do tours for you on FaceTime or take videos to send you in order to help you decide.

5. Make an Offer & Negotiate Terms
Once you find a house you love, make an offer! Your realtor can help you come up with a number based on the fair market value of the home and comparable sales. Once you come to an agreement on the price, you submit an initial earnest money deposit to secure your purchase and you sign a contract committing you to purchasing that home and set a closing date 30-60 days out, depending on the house and loan structure.
Sometimes closings can happen faster if you did steps 1-4 well and you are in a solid position to buy!
Between signing the contract and the closing, a few more things occur such as the appraisal, the inspection, and the final walkthrough. Some of these have additional costs, so that should be factored into your spending from the start.
On top of that, if you’re moving from out of state, you have to consider the moving costs, plane tickets, and potential temporary housing.
 
Now that you are completely overwhelmed and stressed, let me remind you that people do this literally every single day. As long as you have a plan, a solid financial start, and a good team to help along the way, buying a house can be a breeze!

If you’re ready to get started today, contact us directly for more advice or referrals and we would love to work with you in the homebuying process!