Steps To Buying A Home

Thinking about buying your first home? Maybe you already own one and are thinking about selling and buying something else? Or you owned a home in the past and now want to buy another? Regardless of your situation, there are a number of steps to the process of buying your next/first home. Within these steps to buying a home are a number of strategies you can use and you’ll find helpful links and articles here that discuss those. But first, let’s just map out the steps to get you familiar with where you’re heading.

Attend A Homebuyer Workshop

There are many loan programs, especially programs that offer down-payment assistance and those programs sponsored by government agencies, which require a homebuyer workshop for First Time Homebuyers (FTHB’s). If this is you, I would strongly recommend this as your first step. Be aware that many real estate agents and mortgage lenders offer “sales pitch” homebuyer classes. While these can frequently offer good information, they are put on purely as a sales pitch to get you to use the “teacher’s” services. And rarely will these workshops satisfy the FTHB workshop requirement for the above-mentioned programs. Instead, you should look for workshops that are sponsored by government entities. Housing Authorities and State Bond lending programs sponsor these classes. Your teachers may be real estate agents and mortgage officers who are hoping you’ll choose them to represent you or do your loan. However, the sponsoring agency dictates the materials to be covered and certifies you for the special programs.

Decide If Buying Is Right For You

Notice that you should attend a homebuyer workshop BEFORE you decide if buying is right for you. You may be a long-time renter and do not think you can buy, or you may be gung-ho to buy something, but then decide the time is not right once you find out the real facts. If you are at all curious about buying a home, you should attend a workshop and get some current information about the whole thing. And THEN you can decide if buying is right for you.

Choose A Lender And Get Pre-Approved

See How To Choose A Lender to decide on who you want to work with to do your loan, and then get pre-approved. Your pre-approval will help you decide how much of a house you can afford, how much down payment you’ll need, and how much your monthly payments will be. Only after going through this process should you decide on a real estate agent to help you with your search.

Figure Out What Kind Of Home You Want

Your real estate agent will have processes and questionnaires to help you figure out what kind of home you are looking for. You need to know what you’re looking for before you can find it, and any competent agent will have systems to help you narrow down your choices.

Go Find Your Home Sweet Home

There are many ways to locate your dream home, and a good real estate agent will be a great help to you. But even with a good agent, don’t think you do not have to be involved in the hunt yourself. Searching websites, driving around neighborhoods, asking your friends and co-workers for leads are all good ways you can be involved in finding what you’re looking for.

Making An Offer

Becoming a smart buyer will save you thousands on your home purchase. Don’t rely on your real estate agent to get you the best buy possible. It is YOUR money and it is up to you to spend it wisely. Your agent gets paid when you buy something, and even trustworthy, loyal, and honest agents still get paid as much as lousy, not-in-your-best-interest agents. Yes, it’s good to have an agent who will help you negotiate a good price and provide you with information to help you, but it is up to you to get the best price you can and make a good buying decision.

Get The Home Inspected

Once you work out the purchase terms, you’re on the home stretch. This step is crucial for making sure you’re buying something that you won’t regret. Never buy a home without having it professionally inspected. Even if it’s brand new, pay for your own inspector to go through it. Don’t skip this step – ever! Too many true horror stories exist to even consider saving a few hundred bucks and putting your entire financial future at risk.

Complete The Loan Process And Sign The Purchase Contract

There will be a mountain of papers to sign. It is your right to understand what you are signing, so don’t be bullied into – “It’s all standard stuff, just sign here and here and here…” Take as much time as you need to sign the stuff. Even ask for all the paperwork a day or two before signing so you can review them and jot down any questions. Even in this day and age of full-disclosure and heavy industry regulations, people still get screwed by signing something they didn’t agree to. Be careful.

Move In . . .

And you’ll enjoy your home much more, knowing you took the time to understand the process, chose competent and ethical professionals to assist you, got a great deal on a great home, and made careful decisions along the way.

Create A Permanent Paperwork File

Your loan paperwork, your purchase agreement, your home inspection, your appraisal, your title report, your homeowners insurance info, and anything else related to the purchase of your home should go into a permanent, never-throw-away file. You may never look at this stuff again, but if you ever do need something or a dispute comes up, you’ll be glad you took this extra step and know how to quickly locate all of your paperwork.