Should I rent or buy a house? Most people find themselves asking this question at some point in their lives. When the answer is clear that it is time for you to buy a home, your next question may be “what do I do now?” We’ve created a condensed list of what your next steps should be when wanting to purchase a home.
1. Secure a Good Credit Score
Having a good credit score is crucial in obtaining financing for a mortgage loan. First, you’ll want to determine what your credit score is. If you find your credit score on the lower end, your primary focus should be to start building your score up to land you a better rate.
2. Save Money & Obtain Pre-Approval
Next on the list is saving money for your down payment. Typically, all loans require at least a 5% down payment. However, most home buyers strive to meet a down payment of at least 10% to 20%.
You’ll also want to become pre-approved for a mortgage loan. This can be completed through a local bank, online lenders, or a credit union. Don’t limit your option to only one. You will better your chances at obtaining the best deal by shopping around.
3. Determine Your Budget
After you have been pre-approved, you’ll now want to establish a budget. Just because you’ve been approved for a certain amount does not mean you need to borrow a loan at that amount. Work within your means, and do what will work best for you. In the long run, this will lessen your stress of needing to meet a mortgage payment you can’t afford.
4. Find an Agent
Finding a trust real estate agent to begin your home search can be completed once you have all of the above steps completed. Ask friends and family if they have any recommendations as you’ll most likely be more comfortable knowing that they helped your family score the home of their dreams recently.
5. Create a Checklist
After finding an agent you’ll want to provide them with what you are looking for. This comes down to where you see your home be located, what it looks like, and what your needs are inside and outside of the home.
6. House Hunting
This will be the exciting part of when you actually get to look at the homes available. Take walk-throughs of potential homes in your desired area. Look at as many houses as you need to in order to be fully confident in the home you choose to put an offer on.
7. Place an Offer & Close
Lastly, when you have found the home you wish to have, it’s time to place an offer. When your offer is approved you will then undergo the closing process. This can be a lengthy process but it’s important to make sure the house is up to par. After the closing process is completed, you will officially have a new home to call yours.
If you are in the market to buy a new home, contact a real estate agent today to get the process started.