Buying a home is one of the biggest – and most overwhelming – tasks you’ll undertake in your life. And if it’s the first time you’ve walked the path to homeownership, chances are you’re feeling pretty beside yourself with what’s coming next and who’s doing what and just how much it’s all going to cost. Am I right?
That’s okay, though. The smartest thing you can do is get yourself a licensed professional (in the shape of a Realtor® to help walk you through the process), but that doesn’t mean that you yourself should be kept in the dark. After all, it’s your home, your dollars, and your future that are on the line. I’m a big advocate for proper education, even though I’m happy to take the reigns and help my clients through the process. It always helps to get yourself a good understanding of the process from start to finish – so with that in mind, here’s a high-level overview of what a homebuyer can expect, from start to finish.
HomeBuying 101 – for the Smart Consumer
Step 1: Laying the Foundation
Before you can hit the pavement looking for that perfect home, you need to take a good solid look at your personal financial situation. There are a lot of things to consider here: first, how prepared are you to purchase a home? You’ll need to consider your credit – get a copy of your credit score and history and go through it with a fine tooth comb. Make sure to note any discrepencies and get them taken care of ASAP. If you need to, take steps to help improve your score. A good way to do this is to talk to a mortgage professional – they can help you understand where you need to be and what steps you can take to get there.
Once your credit is in tip-top shape, then comes the budget. Ask yourself questions like:
- What am I currently paying in rent/mortgage? Am I at the top of my budget, or is there wiggle room there?
- What can I afford to pay – monthly?
- Consider home upkeep – what type of utilities and maintenance costs will come with a new (or new to you) home.
- Don’t forget things such as mortgage insurance, property taxes, and homeowners insurance.
- Determine what that new budget translates to in terms of home prices. What is your budget range to be sure you stay in those monthly payment parameters you’ve set?
Then you get hooked up with an amazing mortgage professional and get pre-approved.
Step 2: Make Your List
This is where you decide how important your must-haves are in relation to really-really-wants. How many bedrooms do you need? Are you planning to expand your family? What about closet space, garage stalls, land size? What matters to you, and what could you do without?
Make yourself a list, and make sure you keep it handy for the next step so that you can keep all those homes you’re likely to start walking through clear in your mind. Here’s an idea:
This is the fun step – this is where you get yourself an outstanding professional (ahem – raises hand!) and talk to them about what matters. With that pre-approval letter in hand, you’re ready to hit the homebuying ground running!Step 3: Get Looking
Step 4: Getting You Home
Once you and your Realtor have found the home for you, you’ll submit an offer. There may be counter-offers and negotiations, but once that offer is accepted, there are still some steps that will be taken until you get that key and find yourself in the home of your dreams. It may vary depending on your situation, but that timeline will likely look something like this:
- Mortgage Application
- Title Search + Survey
- Apply For Homeowners Insurance
- Submit Loan to Underwriting
- Home Inspection
- Addendum of Repairs
- Final Walk through
- Clear to Close
- CLOSING DAY!
It’s a whole lot of action in a short amount of time – but when you’re waiting for that final step, it can feel like it takes forever! That’s why it helps to have a good understanding of what comes next, plus a really solid professional to help you along the way.
I’d be honored to be that professional!