Finding the perfect home and closing on it may seem like a daunting task. However, the complexities involved in this journey should not hinder aspiring homeowners from realizing this significant milestone in their lives. For this reason, Yusuf Yolasan, one of the most sought-after agents from Berkshire Hathaway HomeServices EWM Realty, addressed himself to the challenge of creating the home buying process manageable. Real-estate professional Yusuf Yolasan explains 10 steps to make home-buying a smooth and enjoyable experience.
First, congrats on making the decision to buy a home. I’m sure you’re feeling a mix of emotions right now – excitement, nervousness and probably some apprehension. You don’t know what you don’t know, right? Here are 10 Steps to Buying a Home.
Step 1: It’s never too early to start your research!
Today, information is plentiful. Browsing online can help you begin to narrow the particular home you might be interested in. Make a note of these, see how long they stay on the market and note changes in asking prices. This will give you a sense of housing trends in specific areas.
Step 2: Calculate How Much You Can Comfortably Afford
If you plan on a 20% down payment and have a moderate amount of other debt, lenders generally recommend looking for homes that cost no more than 3 to 5 times your annual income. Useful calculators online can help you come up with an estimate.
Step 3: Get Preapproved for a Mortgage
Prequalified and preapproved are not the same thing! Prequalification only requires giving basic information to your mortgage banker. However, pre approval requires choosing a lender and providing financial statements. Your lender will tell you how much you can borrow. A preapproval letter will greatly improve your chances of having an offer you give accepted!
Additionally, knowing how much you can borrow will help you target a price range. A pre approval requires a credit pull. Do not be afraid of a credit pull to get pre approved. This tells all parties involved that you are a serious shopper, and they will prioritize doing business with you! Additionally, multiple hard credit pulls within a 45-day window will count as a single hard pull as you shop for a loan.
Buyers with pre approval will likely be chosen over those with only prequalification.
Step 4: Find the Right Real Estate Agent
Real estate agents are important partners when buying or selling a home. Agents can provide helpful information on homes and neighborhoods that isn’t easily accessible to the public. Their knowledge of the home buying process, negotiating skills, and familiarity with the area you want to live in can be extremely valuable. And best of all, it doesn’t cost you anything to use an agent – they’re compensated from the commission paid by the seller of the house!
Step 5: Find the Right Home and Give an Offer
Tour homes in your price range and take notes, pictures and/or videos! It can be hard to remember details as you see more and more. Remember, for many, this is the biggest investment you may make in your lifetime. Taking notes may seem useless initially, however they are helpful in the end.
Things to consider about the home and neighborhood are below.
- Test plumbing and electrical systems.
- Run showers. Check the water pressure/temperature. Even flush the toilets. Don’t be shy!
- Flip the lights.
- Open/close windows and doors.
- Ask questions.
Location, Location, Location
- Is the house on a busy/noisy street?
- Are other homes in the neighborhood well-maintained?
- What places of interest are important to you, and are they conveniently located?
Take as much time as you need to find the right home. Then work with your real estate agent to negotiate a fair offer. Once an offer is accepted, the house will go into escrow, which is the period of time it takes to complete all of the remaining steps in the home buying process.
Step 6: Get a Home Inspection
Typically, offers are contingent on an inspection of the property to check for signs of structural damage or things that need fixing. Your agent will usually help arrange this. This protects you and gives you a chance to renegotiate or withdraw your offer without penalty if the inspection reveals significant damage.
Both you and the seller receive a report on the inspector’s findings. You can then decide whether to ask the seller to fix anything before closing the sale. Afterward, you will have a walk-through of the house to confirm that any agreed-upon repairs have been made.
Step 7: Select your Loan
Every homebuyer has their own priorities when choosing a mortgage. Some are interested in keeping their monthly payments as low as possible, others in making sure their monthly payments never increase and still others pick a loan with the intention of moving again in just a few years. Lenders have a wide range of loan programs. Work with your lender to find what’s best for you.
Step 8: Appraise the Home
Lenders will arrange for an appraisal by an independent party that is not directly associated with the lender. The appraisal will let all parties involved know that you are paying a fair price for the home.
Step 9: Arrange the Paperwork
Your lender will arrange for a title company to handle all the paperwork and make sure that the seller is the rightful owner of the house you are buying.
Step 10: Close the Sale
At closing, you will sign all paperwork required to complete the purchase, including your loan documents. Your loan is typically funded in a few days. Once the check is delivered to the seller, you are ready to move into your new home!
Congratulations! Closing may feel like the end of a journey, but it’s actually just a new beginning.
Learn more about Yusuf Yolasan and Berkshire Hathaway HomeServices EWM Realty here.
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