The road to buying a house can be a pretty long one, especially if you do not know what to expect down the line. With the right knowledge, however, buying a home is actually a pretty fun process. It doesn’t have to be scary at all! While it can be a long process, the road to buying a home is pretty simple once you break it down into parts. Here are the steps you need to take to get down the road of buying a home.
The very first step you need to take is to really think about what you want in a home. What are you looking for? A large, 4 bedroom home with a backyard? Or maybe you don’t want all that space, so a 2 bedroom ranch will do. Maybe you have dreamed of living downtown all your life, so you are looking to buy a condo in a high rise? You should take a minute to list what you want in your home, such as the size, the area, and how much you want to spend (which leads me to my next step).
The next step you need to take is to work on getting pre-approved for a loan. This is the step that many buyers love to skip, but it should be done before your start looking for your home. The reason is because until you have spoken to lender to see how much money they will give you, how do you really know what your budget is? The last thing you want to look is start looking at $300,000 homes, only to find out you are only pre-approved for $250,000. Now none of the homes you can afford will live up to homes you were looking at previously!
Also, another reason you need to speak with a lender first is because most sellers will not take you seriously if you are not pre approved first. In fact, some will not even let you see the property unless you can show them a pre approval letter. The reason is because there are a lot of people out there who want to look at homes for sale, but they don’t plan on buying a home anytime soon. This is a waste of time for sellers, who are looking to sell immediately if their home is already on the market. Because of this, sellers want to make sure that any buyer they deal with is serious about buying, and they do that by requesting your pre-approval letter.
After you have your pre-approval letter, your next step is to speak with a realtor. There are many reasons for you to use a realtor, but here I’ll go over the main reasons. The first reason is that a realtor is totally free for the buyer, so why not use the professional services of a realtor? Second, the seller is going to be using a realtor, so if you as a buyer do not have one, they will try to manipulate you to get you to pay as much money as possible. Remember, that agent is working in the seller’s best interest, not yours. On top of that, it is the seller’s agent that pays the buyers agent. So if the buyer doesn’t use an agent, the seller’s agent keeps all that money for themselves. At that point you are just paying the sellers agent to work against you!
The next step is the fun part: start looking for homes! I suggest that you start by letting your realtor know what you are looking for, and asking them to send you some homes. However, remember that the real estate market isn’t the same as when your parents bought a home 30 years ago. Now, every home that is for sale is available to see online. You can just type in what you are looking for, and check out all the homes for sale at your leisure. Once you find something you like, send the address over to your realtor and they can set up a time for you to view the home!
Look at websites such at Realtor.com, Zillow, or Trulia. All of them have access to the same homes for sale, so you don’t have to worry about one website having homes that the other one doesn’t.
Now, you’re at the point where you found a home you like. Now it’s time for you to make an offer! Ask your realtor to look up what similar homes in the area are selling for, to make sure you are getting the home at a good price. Also, make sure to speak with them about a negotiating strategy when making your offer. For instance, should you start a lowball offer, or should you offer near the asking price because the market is so hot? Once you have your strategy, have your realtor write up the contract and make an offer!
On a side note, a lot of buyers are often hesitant to make an offer because they will be locked in to buying the home. Don’t worry, even if the offer is accepted and you sign the contract, you have time to cancel the contract if you decide you know longer want the home.
After you have the home under contract, your next step is to get an attorney to represent you. The attorney will look over the contract as well as check to make sure everything is ok with the title of the home. I do know that is some states an attorney is not used when closing a home, but in the Chicagoland areas, it is common to use attorneys to selling real estate. Your seller is going to have an attorney, so you should as well.
Next, hire a licensed inspector to take a look at the home. The inspector will look at everything in the home, from top to bottom to look for any current as well as potential issues. Once the inspector is finished, give you a report listing out the issues of the home. Once you get that report, it is very important that you as a buyer do not panic. The reason is because many buyers feel like there should never be any inspection issues, otherwise there is something wrong with the home. As a professional realtor, I can tell you first hand that I have never run across a home that did not have an inspection issue, not even a new gut rehab!
Once you have the issues, get with your attorney an discuss the issues from the report. If there is anything you feel that needs to be address, have your attorney request the seller to make the necessary repairs. Also, you can request for some money from the seller to make the repairs yourself. It is pretty much like a second negotiation. If you can’t come to agreement with the seller, you do have the option to cancel the deal, and get your earnest money back.
Once you make it through, its pretty much a waiting game until the closing date. During this time, make sure to turn in all the paperwork your lender requests as soon as possible, so you do not delay your loan. Also, do not make any large purchases, or open any new credit! If you do this, you can seriously jeopardize yourself and risk having your lender cancel your home at the last minute. Once everything is done, your lender will give you what is called a clear to close, which means you are ready to close on your home!
Once you have your clear to close, contact your realtor to set up the final walkthrough. The final walkthrough, you basically just walk through the home to make sure everything is the way it should be in the home. Make sure all the requested repairs have to made, and nothing is missing in the home. Once everything is clear, the last step is to go to closing, sign all the documents, and congratulations! You have purchased your new home!
Any questions or comments, please feel free to reach out to me here or via email at Robbailey27@gmail.com. Thanks and have a good day!