There is hardly a bigger financial decision you will have to make in your life before you buy your first home. While you may cherish the opportunity to become a homeowner, you need to take the decision seriously. You shouldn’t rush making the decision for many reasons. So should you want to avoid making a mistake when you buy your first home, you need to properly prepare. One of the things that are necessary for preparation is to get your moving plans in order, for which you can use professionals to help you. Here are things we think you should definitely consider before you go out and buy your first home.
Necessary Steps to Find and Buy Your First Home
Determine if a home purchase is a right step
When you become a homeowner you inherit many responsibilities you haven’t previously encountered. If you have rented a flat, your responsibility was to pay rent and bills on time and that was it. Now you have to take care of maintenance which can be quite an arduous task. Also, you will have to start paying taxes and insurance that is related to your home. All of these spell out new costs that you previously haven’t had, so you need to make sure you will be able to cover them as they can pile up quite fast. If you have any debts, you should clear them prior to the purchase.
Another thing to do is to set up an emergency fund before you go out and buy your first home. Often times when you own a home, unexpected cost pop up. It’s better when you cover those unexpected costs from your emergency fund than to put the pressure of debt on yourself. Being under pressure of maintaining ownership while under debt is terribly stressful, so carefully consider if you are ready.
Look around for available loans
If you get a good loan you can then distribute your expenses of purchase for a much longer period. This can help you immensely as it will leave you with more money in your pocket. So start looking around for loans on time. Also, you are required to get pre-approved for a loan before you can buy a home. When the bank pre-approved you for a home loan you will have a price range for your new home.
So to decide what is the best loan for you, make sure you get at least three offers. You can get help from a mortgage broker who can look at the loan companies and tell you which has the best rates. Also see what are your local banks and credit unions offering, as they may have options that save your money. Once you find a loan that suits you and your needs, you can start shopping.
Don’t overestimate what you can afford
It’s necessary that you determine what is a home that you can afford to pay for and live in. Finance experts say that a good measure is that your mortgage, taxes, and insurance be at around a third of your income. You also need to consider that you will have expenses like hiring a moving company. You should also take that into consideration as it can impact your expenses considerably. Call moving companies ahead of time so you know how much is their estimate for moving costs. Call Green Valley movers to get a quote that you can use to calculate expenses.
Getting a smaller house will keep your expenses on the lower end while getting a bigger house can drain your resources quite fast.
Get a good real estate agent
When you determine how much you can spend and you are pre-approved, the next step is to find a good realtor. A sign of a good realtor is that he really listens to you, and understands your needs. That way the recommendations and market analysis that you get are suited to what you need and can afford.
You should get at least several different options. And then when you choose those to your liking, the realtor should go and negotiate terms that you feel happy with. Best way to find a good realtor is through a recommendation of someone who has recently worked with them.
Request to have a home inspection done
This is the most important step that often is forgotten. Get a home inspector to look for any hidden problems with the home. Although it is another cost to add to the list, it can be one that saves you a lot of money in the future. How much money more are you going to spend if later on, you find out about mold, termites or any type of structural problems? Imagine moving into your house only to find out that the roof is leaking. The inspection is preventing you from having to spend a lot of money on unexpected problems, and it can also save you money in other ways. You might be able to negotiate a lower price for your home if you can point out all the issues you found.
Keep in mind that your house inspector should be independent of the one that homeowner has hired. This way you should expect that the inspector is impartial, and working to your benefit.
Putting a bid on the house isn’t the end yet
Once you put the bid to buy your first home, the homeowners need to accept your bid. That can take some time if they have multiple offers, so you should stay patient. Eventually, when they have accepted your offer, you will go into escrow. Escrow is there to protect you, the seller and the lender. Escrow holder will be in possession of all of your documents, money and other necessary information. He will make sure everything is in order before you can get your deal done.
The time you will have to wait before the deal closes can vary. Depending on circumstances around your purchase you will wait shorter or longer time. So be patient for a little while, as your next step will be to sign the closing papers.
Close and Move In
Once you have signed the papers and closed on your home, you can move in. Now as a new homeowner you are at liberty to do any changes to your home that you wish. If you want to do some repainting or remodeling it is best you do it before your furniture arrives. You can use the help of professional packing services to help you get ready for a move. Alternatively, you might want to put your things temporarily in a storage unit.
Once you have settled, go and change your address with your bank and other accounts. Make sure you cancel all previous utilities and set up new ones. If you remain with the same company you might be able to get them to waive installation fees.