Are you a first time buyer? Maybe it's just been a very long time since you purchased a home. Are you feeling a little nervous about the whole process? Not sure where to begin? You are not alone.
The home buying process has changed over the years, especially now that most home buyers begin searching for their perfect home on the internet. Don't be fooled into thinking buying a home is as easy as buying your favorite movie on Amazon. It is true the internet gives buyers outlets to search, however, those sources are not always reliable. It can become a frustrating process if you begin searching before you have a clear idea of what you want and what you can afford.
Here are a few tips to consider when starting your home buying experience. First, take out a note pad and divide it into the following three columns: Must have, Must NOT have, my Perfect Home.
The "must have" column is a list of the things you can not compromise on, for example if you need a three bedroom then you need three bedrooms, a two bedroom won't do but a fourth bedroom is okay. The must have's are the deal breaker items; it these are not in the home you can't consider that house an option. These items should relate mostly to structure, cosmetic items can be changed to meet your needs.
The "must Not's" column is similar to the must have's except these are the items that would break a deal if they are in the home. For example, perhaps you can't do stairs so you need a one-story home, "2-story home" would be in the must Not's column. These items should also focus on the structure and include very limited cosmetic items if any at all. Remember cosmetic features can be added or taken away over time.
The "Perfect home" column is your top ten items you would love to see in your next home but could possibly compromise on if they can be added later. Your Realtor wants to know about these items to try to find as many of them as possible for you, however unless your building that dream home, it's unlikely you'll find all of them in one house.
Now that you have a clearer idea of what you need vs what you want, it's time to call the lender. What?!? You thought it was time to call a Realtor didn't you? Well, if you want a referral from your agent to a lender, than yes, give that Realtor a call and ask for a lender referral.
It is important to get connected with a lender that is local to the area you plan to buy a home, they understand the mortgage programs available to buyers best. If you connect with one that has worked with your real estate agent that's a bonus. Your lender and real estate agent should be working as a team to provide you with the best service. Your mortgage lender will walk you through the application process, discuss the various programs that could benefit you, and explain the types of loans available. Your main goal during your first discussion with any mortgage lender is to find out what programs they can access that benefit you. It is wise to speak to multiple lenders and find the one that you believe you can work with to close your loan. This is a huge step, you need to trust your lender and be able to speak candidly. Once you have chosen a lender, get your application completed to get pre-approved. Your pre-approval is vital to moving forward with your home search.
In the next installment of "What Every Buyer Should Know" we will share how having a buyer's representative protects your interests.