Purchasing a home is usually one of the most exciting experiences of your life. Despite its many rewards, the process of buying a house can also be a serious challenge. Read our guide so that you’re prepared fo for buying a home before beginning your search.
1. Mortgage Pre-Approval Before Buying a House
When buying a house, getting pre-approved for a mortgage before looking at properties lets you know which homes you can realistically afford. Buyers who have been pre-approved are taken more seriously by sellers. The lender will usually offer you a mortgage that is at the top end of your range and more than you’d like to spend each month, however, you don’t have to accept the full pre-approved amount.
2. Create a Realistic List of Potential Expenses
A general rule of thumb is that your monthly mortgage payments should not exceed one-third of your take-home income. Depending on your financial situation, there may be some leeway involved when determining what you can afford property-wise, but you should also factor in potential repair costs and upgrades you’ll want to make to the property.
3. Make a List of Qualities You Want in a Home
When buying a house, it is easy to get caught up in the excitement of the moment. Be sure to stop and think about the long-term consequences of purchasing a house. This is a very important step in the process of becoming a homeowner.
For example, living in an area that requires long commute times may make your new home feel like a burden after only a few months. Homebuyers with young children should consider the quality of the school district. As a general rule, it is definitely worth asking whether your first-choice property fulfills your long-term needs before you sign on the dotted line.
4. Don’t Become Too Focused on One Particular House
For people interested in buying a house, it can be disappointing to learn that a potential dream home has been purchased by someone else. Losing the chance to purchase a much-desired property isn’t an ideal outcome, but it’s important to keep looking at other homes even when you are frustrated with the house-shopping process. Sometimes, the chance to purchase the perfect home occurs when we’re least expecting it.
5. Get a Home Inspection When Buying a House
No homeowner wants to discover serious problems after he or she has closed on a home. Fortunately, a home inspection can protect you from getting into this situation. Homebuyers who forgo the inspection risk overlooking expensive issues that make the house much more expensive than they thought it would be.
6. Negotiate a Better Price
In high-demand areas, it sometimes seems pointless to ask about a potential discount on a list price. But even if you are uncomfortable about asking for a lower price on the home, you just might be surprised at the answer you get back. Even a discount of $10,000 can significantly affect how much you’ll pay over the course of your mortgage. It might also put a dream house within the range of your budget. Rely on your real estate agent to help with negotiations. He or she will know what problems are worth negotiating over and which should be left as-is.