10 Simple Ways On How To Buy A House
The process of buying a house can be exhausting and time consuming in most time. In fact, there might be some stages that would be very frustrating and rough and that is why you need to learn easy ways to follow. There are many issues involved and you need to get it right and make a good purchase.
In fact, first timer usually experience difficulties in this quest as there could be some challeging procedures to follow. However, it is very possible for you to follow simple and legit ways that will enable you to succesfully buy a house at ease. The fact is that getting the home purchase experience right is never a luxury but rather a necessity. Although, with some better financial steps and tips, you can be able to get your dream house at a convinient schedule.
It is important you have knowledge on how to buy a house and when you are able to know more, you will make better choices, able to save your money and even time and energy.
Here are 10 ways we have highlighted to get you more insight on how to buy a house, they include:
- Know What You Want In A Home: It is very important that you note what you desire and want in a home. It may include the type of design or size the house will look like. Also, You need to think of your family status and probably about downsizing too. You will need to decide about the property type whereby it can be in a form of townhome or single one or family type. The size of the house also matter so that you will have a specific size in mind. This means you need think make a projection such as thinking of the next 5years to come or how you will be in the next 10 years for you to know the required size for your house. In addition, you should think about condition of the house you want either new construction or old one. It is better you know what condition you want from a house before you embark on house shopping. Another thing you should decide is neighborhood which will base on your lifestlye.
- Start Saving: It is not really easy to buy a house as it takes a lot of time and it is in that regards that you need to start saving for a new period. The moment you are able to know what you want in a house, it is important you start saving in order to act fast. There is no how you will need to make a good purchase without having cash the earlier you save the better. When you lenders realize you have enough money saved up, you will be able to easily buy a home. This will enable the lender to believe that you can come up with the cash needed to buy a house at the negotiating table. This shows that it is effective to save money early before you set your eyes on that dream home.
- Know How Much Is Your Home Down Payment: Just that there are many homes can be easily be purchased with as low as a 3% down payment, others can’t. Therefore, it is important you look into having 20% of the potential cost of your house saved up for a down payment.
- Know Your Credit Report: Regardless of whelther your credit report is good or bad, it is essential for you to pull it and know where you stand. In case you have any issues with some of your accounts, it will be indicated in your credit score which will enable you to note them and possibly fix it. It is expedient you know your credit score and possibly look into ways you can improve your credit score. It is through your credit report that lenders would have more insight about your financial operation. Meanwhile, the higher your credit score, the more possible for you to get a home loan and even possible to pay a lower interest rate. This is a good reason why you should know your credit score and report.
- Choose How Much Home You Can Afford: It is neccesary for you to determine your budget in house buying process. It is never a bad idea to search online for homes and get to know
of different prices. If you choose not to pay all cash, you will be probably finance your home purchase with a mortgage. This means you will be able to purchase a house depending on the amount you are able to borrow which will directly determine the price of the house. It is with this regard you need to know how much house you can afford and stick to it. However, the rule about mortage payment should be put into consideration typically known as 28% rule that says you should not spend more than 28% of your total monthly income on housing costs. However, lenders usually accept a 36% debt-to-income ratio and when you are able to calculate it, you will have insight on how much you can afford for each month for your mortgage payment and how much you can be able to borrow.
- Know About Mortgage Options: There are two mortgage options you will need to get to look into. They are fixed rate and variable rate. Fixed rate mortgages offer lenders opportunity to get into a fixed interest rate over the lifetime of loan while variable rate mortgage usually go up and down on a regular basis. It is however subject to the movement of U.S Treasury bonds. Meanwhile, variable rate mortgages usually come with lower interest rates up front.
- Get Pre-Approved For Loan: It is a good step to secure a loan and getting pre-approved is very important in the mortgage process. Pre-approval usually serve as a conditional commitment from the bank. Before this can be done by any bank, it is expected that you provide correct and adequate information about yourself during the process. Information expected might include: proof of income generated, evidence of assets owned, authentic document of your employment, identification documents and social security number to run credit. The lender will go through the information submitted and check if you are a good risk or not. It is after that you will get an official pre-approval letter. The pre-approval is a key part of the home buying process. It will shows that you are very serious about buying a house and also have money available to carry it out.
- Get a real estate agent: This is another serious part of home buying process as it essential to someone that is well experienced, skillful,perserverance and committed to help you through the process. A resourceful real estate agent will certainly know good homes in good communities and areas that are appropriate for you. They will also help you to negotiate a better price when you choose any property. You can ask around from your friends and families on recommended estate agents that you can use or better still go through online sites such as Realtor.com, Zillow and many more. Make sure the agent you wish use has idea and knowledge about your area.
- Locate Home You Love: The moment you have been pre-approved for a loan and gotten an estate agent. It is appropriate for you to start looking for your dream house. You can search it online and even attend open places. In a situation whereby you give out details of what you need in your house, your estate agent can have a good idea of what you are requesting for. You will be able to get a list of homes you can visit and make a choice. You should also be in touch with your real estate agents often to notify them if your desire change.
- Submit an Offer: The next thing you need to do is to submit offer and this is a point where you will need the assistance of your estate agent most as you will need to make sure your offer is accepted. Making offers on home and being rejected could be disheartening and uncouraging. Speak up with your agent and know how you can succesfully scale through.
After your offer is accepted, you can then proceed to follow processes:
- Get a home inspection
- Get home insurance
- Move in