Buying a new home is a very exciting time in your life. This is one of the biggest investments that you will make in your lifetime. While buying a home may be exhilarating, it’s a process that doesn’t come without a bit of stress. Being able to find a home that you love, getting approved for a mortgage, and closing on the property can wear you down pretty quickly. There’s a lot that goes on behind the scenes of a real estate transaction. There are also other buyers to compete within your area. If you’re determined to get the home that you want, here are some things you should keep in mind.
Not all realtors are the same, which is why you should take some time to find somebody that is going to mesh well with your personality. If you’re trying to find a home that you love as soon as possible, then you probably don’t want to sign up with an agent that is very casual about looking for properties for clients. Find someone who works hard, has insider information, and is always available to show you a property. Pick someone who is knowledgeable about the area you’re thinking of moving to.
There’s absolutely nothing worse than falling in love with a home, only to realize that you can’t afford the asking price. A lot of sellers won’t budge on their listing price if they know they’re being realistic in the first place. You’ll want to make sure that you have a good budget set aside before you start actively searching. Try to save up for a bigger down payment than you might think you need. According to City Creek Mortgage, you should be aiming for at least 20% to avoid paying for mortgage insurance. If you are able to stick to your budget, then this will be a great opportunity. If you need to spend a little more, this can open up the market.
The home buying market can be very competitive. You want to make sure you have good credit while you’re looking for a new home. Make sure your debt is paid off, you've checked your credit score, and that you’ve considered your current pre-approval amount before you start looking for a home. If you have current issues with your credit score, then you need to take care of this. If you have to give yourself an extra six months or one year to get things straightened out, dedicate yourself to that process. It’ll be a longer road but it will be worth it when you find your dream home and aren’t restricted by a bad credit score.
Getting pre-approved for your mortgage will give you a little bit of an edge over another bidder. When you have a specific location in mind, you can come right in and place a bid. Your agent will communicate to you that you’ve already been pre-approved. Nobody is going to have to wait around for you to see if the bank is going to approve your loan amount.
It’s easy to see a home and fall in love with it. If you fall in love with a home that you cannot realistically afford, then you are setting yourself up for failure. Be realistic about what you can afford, but also think about what you are capable of taking care of. There is a lot of maintenance that will go into the overall cost of your home long term. You shouldn’t spend everything that you have on a property. Also, don’t get into a bidding war that is way over what you can comfortably spend.
A great option is to build a custom home. Compare the pros and cons of a custom home over a prefab home before you start, but this gives you a lot more flexibility. You will work with a builder to design the layout of the property. Building a custom home will give you the ability to carefully choose and include any home features you like. You get to choose everything from where your outlets are to what your lighting will look like. You will want to familiarize yourself with local codes before building your custom home so you know what is allowed in your area.
A short sale is a home that is valued at less than what is owed. Many people are drawn to this type of listing because of the prospect of getting a bargain. However, a short sale usually takes a very long time to go through. Your closing date can be up to five times longer than a typical closing. By this time, your dream home can be in need of repairs since nobody has been living in it. Your time being tied up in the buying process will also cause you a lot of stress because at any time, the bank can step in and cancel the entire process.
If a home is very affordably priced and it has certain features that people are looking for, you could have a large number of people putting a bid on the house that you want. The seller has the ability to choose what bid they’re going to accept so be prepared to quickly outbid another party if you really want to get the home of your dreams. You can even consider buying out another bidder to remove them from the equation. However, be careful that you’re not getting too carried away with the amount that you are dealing with.
The real estate world can go up and down over the course of just a few months. You can have a bunch of buyers rush the market, only to have everybody disappear for many months. This often has to do with the time of year, what holidays are coming up, when the school year ends, etc. You should also pay close attention to what the interest rates are doing when it comes to mortgages. A big decrease in rates can motivate people to start looking again. If you know what is going on within the market at a certain point in time, then you can leverage this during your buying process.
It can be very stressful to look for a home and place a bid on one. The best way to alleviate some of this stress is to educate yourself beforehand. You want to know what to expect during the process, what to watch out for, and what you can safely afford. This will ensure that you’re about to make a wise investment choice.