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If you’re like many people, buying a home will be one of your largest investments. So many factors go into selecting and purchasing a property that it can sometimes become overwhelming. However, by creating and following a checklist, the entire process runs more smoothly.
From determining wants and needs, to deciding on the things that will contribute to the long-term enjoyment of your home and neighborhood, right down to details of the actual purchase, home buying can be fun. Here’s how to get started:
Research and Prepare
The first step, before looking online or checking out local listings, is to see what you can afford. Start the process by contacting your local bank, mortgage lender or other reputable lending institution. Remember, you need your lender to be there with you throughout the process - including the day of closing when you loan will be funded so ask a lot of questions about how they handle home purchase.
Many lenders recommend potential buyers limit their home search to properties that are no more than 3 to 5 times their annual combined household income. Down payment of up to 20% may be required upfront. It's a good idea to start gathering pay stubs, tax returns, and other proof of income. Also, once you qualify, don't make any changes that will affect your credit rating, including securing a new credit card, cosigning a loan, or quitting your job. Lenders requalify you up through closing day, so any changes will impact your ability to buy.
Find a Home and Get the Details
Once you know what you can afford, start identifying areas in which you are interested and do some research, either by looking online, checking out the local newspaper, or consulting real estate magazines. Your local Board of Realtors offers a wealth of information regarding price trends and can provide you a list of Realtors who specialize in your market. While having your own Realtor isn't required, licensed Realtors can help you refine your search and locate homes in your price range and location of choice. Plus, they are skilled negotiators who can help you get the best value for your dollar.
Tour homes in your price range with your realtor and take notes on all the homes you visit. Some sellers will even allow you to take photos or video that you can display to others as you consider the home’s total features.
Though total time in a home will often be brief, make sure to pay special attention to details such as plumbing, electrical system, windows and doors, and other specifics. Outside the home, observe the surrounding homes and neighborhood. This includes maintenance and condition of nearby homes, traffic, proximity to amenities (schools, shopping centers, parks, and public transportation), and other factors.
When you’ve decided on a home you’re interested in buying, schedule a home inspection. A certified home inspector will search for signs of structural damage and items that must be repaired. A home appraisal is a separate process aimed at determining the value of the home.
Coordinate Paperwork and Close the Deal
Once you find the home of your dreams and have a bilaterally signed contract (when both you and the seller have agreed upon the terms), you'll finalize the details with your lender and the title company. For more details on the home buying process, please consult our 3-minute video /buyers/index which gives more insight into the closing process.
Delivering the ultimate closing experience is Southern Title's mission. Contact us today to discover how we can help put you in the home of your dreams.