4 Easy Steps to Take When Buying a House
Buying a house is a big financial and personal milestone to hit, but although many people find themselves at this point in their lives, it’s not always easy to figure out how to navigate the process. To make it easier to find your way, we’re offering some tips and step-by-step guidelines in this post.
4 Steps to Buying a Home
1. Figure out your finances first
Starting your house hunt is a truly exciting time in your life. From admiring kitchens to planning upgrades to make your first home really your own, there’s so much to look forward to and embrace during this experience. But before you dive into the real estate market and start making wish lists and narrowing down neighborhoods, you may want to check up on your finances first. Do you plan on making a big down payment, are you going to try and refinance your mortgage later on? These are important questions to answer.
Unless you recently struck the lottery or have substantial savings, you’ll probably need to apply for a mortgage in order to join the ranks of homeowners. To get approved for a mortgage with a favorable interest rate and manageable monthly payments, you’ll need to meet the high expectations of lenders. Here are two important things you to do in order to position yourself for a good mortgage:
- Establish good credit: Having a good credit score can offer you many benefits in life. From helping you get premium credit cards to getting approved for low-interest loans, there are many perks to maintaining a good relationship with credit. To make sure your credit is primed for a good mortgage, start by checking your credit score—experts say scores 800+ get the best offers. If your score isn’t in such shape, you might consider putting your move on-hold while you work to improve it.
- Save for a down payment: In addition to having good credit, you’ll also want to have enough money saved up to pay a sizable down payment. The more you’re able to put down, the less risky your mortgage becomes; this may help you score a lower interest rate with your lender. If you haven’t put any money away for a down payment, start by opening a savings account.
2. Compare financing options
Once your finances are in good condition, you can start applying for mortgages. While you’re applying, be sure to consider all of the options available to you; you never know where you might find the best value! There are even specialized loans like VA loans in California that benefit veterans and active service members, and there are USDA loans in rural areas that are designed to benefit those in the agricultural industry. Taking the time to shop around and weigh your options can seriously pay off!
3. Create a wish list
Here’s for the exciting part—dreaming up your dream home! Whether it’s a walk-in closet or a hacienda-style setup that’s on your must-have list, now is your chance to narrow down your wants and needs. As you create your wish list, try to split the list between must-have items and nice-to-haves. This way, you can rule out homes easier, but still be flexible and realistic enough to find a home that meets most of your needs.
Some of the most important items to consider include:
- Number of bedrooms and bathrooms
- School districts
- Storage space
- Potential for expansion, customizations.
4. Start your house hunt
After you’ve got your finances and wish list squared away, it’s time to dive into the real estate market! If you hire a real estate agent, they’ll present you with several options based on your requirements, which can really help streamline your search. When looking to hire a realtor, make sure to do your research. Ask family and friends for recommendations and look for an individual that has a good reputation in your area.
If you’re going it alone, check out these home listing sites to find out what your desired neighborhood has to offer:
As you embark on this exciting journey, just keep these tips in mind and you’ll be sitting pretty in your new digs in no time! What’s on your home shopping list? A modern kitchen? Big backyard? Tell us about your dream home in the comment section below!