If you’re in the planning stages of buying your first home, you’re in luck: This guide can walk you through the entire process, and you can read it before you find a real estate agent to help you start searching.
The Complete Guide for First-Time Homebuyers
This guide covers:
- What to do before you start looking for a home
- How to find the right real estate agent
- The basics of house-hunting
- How to make an offer on a house
- The closing process
- Moving tips for first-time buyers
Here’s a closer look at each.
What to Do Before You Start Looking for a Home
Check out the steps you should take before you start looking for a home.
1. Figure out how much you can afford.
The first step in buying a home is figuring out how much you can afford. You’ll need to know your monthly budget, as well as your down payment and closing costs.
One way to figure out how much you can borrow is to use a mortgage calculator. This will give you an idea of what your monthly mortgage payments would be.
2. Get preapproved for a mortgage.
Getting preapproved for a mortgage is the next step. This means that the lender has looked at your financial information and has approved you for a certain amount of money to borrow.
This is important because it shows sellers that you’re a serious buyer, and it also gives you an idea of what houses are within your price range.
Related: Could you lose your earnest money deposit?
3. Find out what’s in your neighborhood.
Before you start house-hunting, it’s important to do some research on the neighborhoods where you’re interested in living. You’ll want to know about things like the school district, crime rate, and average home prices in the area.
4. Choose the right time to buy a house.
There’s no perfect time to buy a house, but there are times when it might be better or worse than others. For example, if you’re buying a home in a hot market, you’ll likely face competition from other buyers and may have to pay more than the asking price.
Related: What are mortgage points?
How to Find the Right Real Estate Agent
The following sections outline how you can find the right agent to represent you in your transaction. Remember, you don’t pay for a buyer’s agent’s services – the seller does.
1. Get referrals from people you trust.
The best way to find a good real estate agent is to get referrals from people you trust, like friends or family members. If they’ve had a positive experience with an agent, they’re likely to recommend them to you.
2. Interview multiple agents.
After you’ve gotten some referrals, it’s time to start interviewing agents. You’ll want to ask them a few questions, like how long they’ve been in the business and how many houses they’ve sold in the past year.
You should also ask to see a list of references from previous clients. This will give you a better idea of how they work and if they’re the right fit for you.
Related: 5 common contingencies you’ll see when you buy a home in Midland
The Basics of House-Hunting
Now that you have a real estate agent, it’s time to start house-hunting. Here are some tips to help you out.
1. Familiarize yourself with the market.
Before you start looking at houses, it’s important to learn about the current market conditions. This will help you understand what you can afford and what to expect when making an offer on a house.
2. Narrow your search criteria.
It’s easy to get overwhelmed when looking at houses, so narrow your search criteria down to a few key things that are important to you. This will make it easier to focus on the houses that are a good fit for you.
3. Make a list of must-haves and wants.
Another way to narrow your search is to make a list of must-haves and wants. This will help your agent know what type of houses to show you.
4. Tour different types of houses.
It’s important to tour different types of houses, not just the ones that are within your budget. By doing this, you’ll get a better idea of what type of house you want and what’s available in your area.
How to Make an Offer on a House
Once you’ve found the perfect house, it’s time for the next step: making an offer. Here are some tips on how to do this correctly.
1. Have your agent write up a purchase offer for the house.
Your agent will write up a purchase offer for the house based on your budget and needs. This offer will include information like the price you’re willing to pay and the date by which you want to close on the house.
2. Negotiate with the seller’s agent.
Once the seller’s agent has received your offer, they’ll present it to the seller. The seller may then choose to negotiate with you, which is where your agent comes in handy.
3. Get a home inspection.
Once you’ve reached an agreement with the seller, it’s important to get a home inspection. Generally, a buyer must pay for their own inspection.
Related: Do you need preapproval before you make an offer?
The Closing Process
The closing process is when the purchase of the house is finalized. This usually takes place 30 to 60 days after the offer is accepted. During this time, you’ll need to get a loan, if you’re financing the purchase, and complete a final walk-through of the property. You also need to remember the information in the following sections.
- You’ll also need to sign a lot of paperwork, including the sales contract, mortgage, and disclosure statements. Make sure you read through all of these documents before signing them.
- Your agent will help you with the closing process and will be there to answer any questions you have.
- You may need to provide a down payment at the closing table, which is typically 10-20% of the purchase price.
- Once the closing is complete, you’ll be given the keys to your new home.
Related: 3 great reasons to come up with a strong down payment before you buy a home
Moving Tips for First-Time Buyers
Now that you’ve closed on your house, it’s time to start packing for the move. Here are some tips to help you out.
- Start packing early and don’t wait until the last minute. This will help you avoid feeling overwhelmed and stressed out.
- Get rid of anything you don’t need before packing. This will lighten your load and save you space.
- Pack an essentials box that includes things like toiletries, clothing, and medications. This will make it easier to find what you need when you first move into your new home.
- Label all of your boxes so you know what’s inside. This will make unpacking a lot easier.
- Hire a reputable moving company to help you with the physical labor. This will save you a lot of time and energy.
- Have your utilities turned on at your new address before you move in. This will help you avoid any disruptions in service.
- Update your address with the post office and other important institutions. This will ensure that you continue to receive important mail and packages.
- Make sure you have renter’s or homeowner’s insurance in place before you move into your new home. This will protect your belongings in case of an accident or theft.
- Take some time to explore your new neighborhood. This will help you familiarize yourself with your surroundings and meet new people.
- Relax and enjoy your new home! You’ve earned it!
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