Taking the plunge into home ownership is extremely rewarding; however, it can also be a bit scary. From tons of decisions clamoring for your attention, to unfamiliar jargon and processes, it's easy to feel overwhelmed.
Add some peace to the process of buying your first home by using our ultimate buyer checklist!
Analyze your budget. Understand where your money goes, which bills are required, and which aspects you can whittle down to save on.
Fatten up your savings. You will need cash for a down payment, closing costs, moving expenses and other expenses that may arise during the home buying process. The more savings you build, the better your position.
Find a reputable mortgage lender. You will have two best friends during your home buying process, and your loan officer is one of them. Find a person who is experienced and willing to answer your questions; this is your advocate to getting the right mortgage and the home you want.
Dig up the important papers. Locate your W-2 forms, pay stubs, tax returns, and bank statements. Tote them with you to your first appointment with your mortgage lender so that you’re prepared to start the process.
Put some thought into interest rates. Research interest rates and understand how they affect your monthly payment. Your lender will assist with this education and matching you with the right rate.
Choose the right type of loan for your situation. Fixed or variable? Federal or private? Decide what type of loan, and the length of the loan, you will use to purchase your house.
Decide how much house you can afford. Set a range you can spend, and do everything possible to stay within it as to not financially overextend yourself.
Polish up your credit score. Pull a credit report, dispute errors and pay down credit cards.
Settle on the area and type of home. Pinpoint neighborhoods, styles and features of homes you like to target during your search. Having a focused search will help you find your dream home quicker.
Get pre-qualified. Getting pre-qualified for your mortgage will give you a clear idea of the home you can afford when searching the market and goes a long way toward showing sellers you are serious.
Choose a professional realtor. You second best friend is a knowledgeable, helpful realtor that can help you navigate the home buying process.
Be prepared to make the right offer. Work with your realtor to decide the amount and the terms of your offer. Be sure to consider all factors and the specific sellers when putting in an offer, as it often leads to a higher rate of success.
Set contingencies. Add anything you require to your offer so you are protected against nasty surprises that may hurt your budget.
Get ready for closing. Be prepared for closing with all necessary documents and payments ready. Having to delay your closing because of contingencies or surprise costs may hurt your offer.
Buying your first home is daunting, but adhering to this checklist will prepare you for the process, keep you focused, and assist you in ending up with the home of your dreams. For more useful information about buying your first home, download our First Time Home Buyer eBook now!