Things to Do Before Buying a House
Wednesday, March 27, 2019, 6:00 AM | Leave Comment
Smart Considerations Before Purchasing a Home
Have you been renting a home and have decided now is the right time to jump into the housing market?
Purchasing a new house can be excited and challenging, too, particularly when you are planning to buy in another city or just have a short time to purchase.
Quite a bit of planning should go into your purchase before you ever set foot in a property.
Here are a few useful tips to help you make an informed decision before buying a house.
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Know the budget
One of the best tips before purchasing a home is to plan your budget. Be practical and realistic. If you are moving to another state or city, it is necessary to take into account the cost of living and new wage scale in the area.
Try to figure out how much you can afford on a home loan, utilities, taxes, and insurance. Also, you need to include moving expenses and other relocation costs. All of these factors should be put into your budgeting plan.
Do not forget to estimate the selling value of your current home and if you could afford to get a larger mortgage. Also, keep in mind to set the highest price that you can afford to you some room for negotiation.
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Pick a lender that makes the most sense.
One of the most critical steps in the home buying journey is understanding how to pick a lender. Most first-timers automatically focus on the interest rate the lender is going to give them and nothing else. This can be a big mistake because other fees could trump the interest rate, making the real cost of the loan much higher.
It is essential to compare apples to apples when you are shopping for a lender. Make sure you have a clear understanding of all the costs and fees. This will go a long way in determining which lenders really have the best terms and conditions.
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Secure a home loan before searching
Securing a mortgage seems to be common sense. However, many people who are rushing to look at new houses often forget that it takes time for a mortgage to be approved. When you are pre-approved for a home loan, everything will be more straightforward since you can know the exact budget and make a better offer to beat out other competitors.
What you will want to have is a mortgage pre-approval letter from a reputable lender. You’ll need to make sure it is a full pre-approval letter and not just a pre-qualification.
There are extreme differences between these two mortgage terms. They can be confusing to buyers, but essentially with a pre-approval, the lender has verified your job status, income and pulled your credit. With a pre-qualification, none of these things happen.
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Create a list of top features in your new house
Everyone in your family should make their own list of ideal features in a new house. Keep in mind that they should be realistic. If you have teens or kids, tell them what size home you can afford and have them figure out some desired features. This is a great way to keep the kids on board, especially when you are moving across the country and they are losing their friends.
Once everyone completes the list, ask them to rank their priorities. What do you want to sacrifice or prioritize? Next, discuss and try to come to a consensus of what features are essential for the whole family.
This list will make our search simpler, as well as increase the chances of finding the best fit for your family.
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Know your neighborhood
The next thing is to take a look at potential neighborhoods. Start with checking out the priority prices in the local to figure out whether you could afford a new house. Of course, you need to select a couple of neighborhoods which are within your planned price range.
Also, you need to check out other facilities and services such as schools, supermarkets, parks, roads, shops, and more. Make sure these areas might work for your case. In most cases, you have to compromise on several things. That is totally okay. Indeed, you need to be flexible and try to prioritize on some crucial things.
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Hire an agent
While it is not actually necessary to hire a real estate agent, having an experienced expert behind can be helpful in narrowing down the list of option. This is especially correct when you are moving to another country, state, or city.
Also, it is essential to have a local professional to represent your interests. They would provide you with specific details about the house prices, schools, and neighborhood in the region. Working with a local expert is important. Look for a real estate agent with a consistent track record of success, not someone who just got their license or is part-time.
There is no room for mistakes with such a large transaction.
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Ask some related questions
Before deciding to purchase a house, you should create a list of essential questions concerning key features like furnace age, kind of heating, utility costs, age and type of roofing, and more. There is nothing more important than home buying due diligence. Also, it is advisable to view the house at various times, both day and night to find out any issues associated with noise and traffic.
There are so many external factors that can influence the value of the home you purchase. If long term appreciation is important, don’t underestimate the importance of the town, neighborhood and even the school district.
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Take your time
Never rush into a property purchase because you might feel pressured and stressful. Instead, take your time to check out the parks, restaurants, grocery stores, and schools. Make sure you know the neighborhood well and talk to the neighbors.
Ask to visit the house more than once. Research real estate prices in the local area and the potential for growth in the future. Think about what you enjoy and ensure you can find these things in the area.
Also, attempt to imagine living there and make sure the new house is suitable for your needs and preferences.
These are all important things to do before buying a home.
Final thoughts
There is a lot that goes into buying a home, especially when you are going it for the first time. Make sure that you’re prepared financially as well as emotionally before jumping into the housing market. Purchasing real estate is a big step. There will be lots of responsibilities that come along with being a homeowner. Best of luck with the journey!
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