If HGTV has taught us anything, it's that buying a home is one of the most important chapters in your life. But while it can be a thrilling experience, venturing into home ownership can be a nerve-wracking experience, especially with a fluctuating housing market.
Whether you're a first time buyer or looking to transition from a smaller home to a larger one, it's important to keep yourself well informed to help make the process as smooth as possible.
Check your credit score
If you want to know where you stand with buying a home, it's essential to always check your credit score. Your score is one of the most important factors to consider if you want to qualify for a loan from the bank. To stay on top of these money matters, get a copy of your credit report — you're entitled to one every 12 months, but be wise when looking up information. "Hard inquiries" like applying for a credit card or a loan can affect your credit score so keep in mind the standards for qualifying and how it will affect the cost of a potential loan from suitable lenders. Additionally, explore different lenders as a low interest rate for mortgages can make all the difference when becoming eligible for a loan.
Find an affordable home
When it comes to buying a home, the general rule of thumb is to find one that is two-and-a-half times your annual salary. While there are a number of online tools and calculators to help you understand your income, keep in mind mortgage lenders will examine your income size, stability and score as a way to consider your affordability. Calculate a potential mortgage based on your combined income and any other assets or liabilities you have, just to understand the flow of expenses and then create a budget. Keep in mind besides your mortgage, there will be energy costs, property taxes and more.
Get a realtor
Thanks to the internet, finding the home of your dreams has never been easier. But just because your humble oasis is just a click away, doesn't mean you can just go in and buy a home on your own. Many aspects to buying a home require an adequate level of expertise. Between the negotiating and contracts, a licensed professional can grant you better access and make the home ownership experience all the more convenient without you stressing out. Recruit an agent who has your best interests at heart and will make it their goal to help you get the best for your family.
It's time to be the Sherlock Holmes of homes and before making a bid or even finding the home, do some research on the location's demographics and statistics. What is the estimated market value for homes in that area? Is it more favorable for sellers or buyers? Never be impulsive. Instead, research by going on a walkabout in the neighborhood, checking how long the home has been on the market, the length of ownership, flood zones, permits — there is much to consider but it's primarily based on your own needs and wants. When you think about making a bid after all your research, come up with a price that's competitive but also realistic.
Think of the future
You should never buy a property unless you are completely sure you will be staying in the neighborhood for a few years. Your home is the biggest investment and should be carefully deliberated before moving in or moving out. Whether you are looking to have a family or not, find a neighborhood with good schools as this helps in your home's resale value. Moreover, when considering the future, hire a home inspector prior to moving in who can point out problems that might require repairs down the line.