Let’s be honest, shall we? The process of buying a home is enough to drive even the most level headed of us completely insane! It can cause you to loathe every person involved with complete disdain at least once. So, before you start pulling your hair out, I’m here to help. I’ve compiled 7 steps to help you keep your cool, get the job done, and end up with the home you want.
#1 Getting pre-approval of your loan
It is vital that you get pre-approval with a mortgage lender before you even start to look at homes for sale. You have to know what price range a lender will approve you for and the type of mortgage they recommend for you. Some areas don’t even allow you to make an offer without a pre-approval letter, and why would you want to? In order for a seller to take your offer seriously, they need to see that you are backed by a credited financial institution for your loan.
As was the case in my situation, my buyer agent was able to send us to an excellent lender. We were lucky enough to be comfortable with them and how they directed us from the start. Unfortunately, that may not always be the way it works out. Feel free to visit with several lenders until you find the one that meets your needs most efficiently. It would be a nightmare to be stuck with a lender you aren’t pleased with, and then have to try to find a new one in the middle of the buying process. Be sure your lender will back up your decision of how much you want to spend and not how much numbers and paperwork say you can spend.
#2 Know your priorities
It’s not always feasible to tell your agent a generic search preference. Such as saying you want 4 bedrooms, 3 bathrooms somewhere in this town. Today’s local market may bring up thousands of matches depending on your city, and half of those may already have a sale pending. It’s best to narrow it down and be as specific as possible. You may want to say something along the lines of:
“We’d like a 4 bedroom, 3 bathroom, two story, detached brick home with a fireplace, gas appliances, bonus room and 2 car garage between $275,000 to $300,000.”
This will shrink the results down dramatically! Now, instead of sifting through thousands of homes (which is impossible), you will be shown a reasonable amount of listings.
Also, keep in mind, there is a difference in what you’d prefer to be in your home versus what you absolutely must have, no questions asked. Another great idea is to go one step forward and decide what you definitely DON’T want in a home. (Maybe you don’t want a pool because you have small children or maybe no stairs because you have bad knees. Whatever the case may be, your realtor will thank you for that information). Then again, you may not even know what your priorities for a home are yet. You may have to look at homes and get to see different features firsthand. That will definitely help you to see what makes a home great for you and what doesn’t. Eventually, you will decide and be able to narrow the search even more.
#3 Keep your head out of the clouds
Everyone has seen the pop-ups for “5 bedroom homes with 4 full baths on 5 acres of land, for only $500.00!” Not only are they giving it away, but did I mention it’s “in a gated, private, upscale community”? Why isn’t everyone buying these houses you ask? Um, because they don’t exist for these prices. Banks are in the field of making money, not giving away homes like they’re free puppies. Would you list your home like this for $500.00? Of course, you wouldn’t. You want market value just like any financial institution does.
Sometimes buyers run into the problem of expecting too much. You may want stainless steel appliances and a marble fireplace in a house built in the colonial era. Maybe it exists or maybe it doesn’t. Something meeting that standard may be few and far between. Don’t expect perfection in a previously owned home. Every home will probably need some work or upgrading. Even brand new homes run into their fair share of problems during the inspection process. The point is, stay positive and realistic. Nothing’s ever truly perfect.
#4 Have flexibility
You really have to know how to bend in home buying. The odds that you will walk into a home that is what you’ve always dreamed of from top to bottom, both inside and out, is about 0.00000000002%. (Or so I’m guessing). Cosmetic issues can be changed at a later time; walls can be painted, carpet can be replaced, and new light fixtures can be hung. What can’t be changed is the negative impact you may have on a seller if your list of demands to reach an ideal “perfection” is outrageous. If it’s something that really matters to you about the house, then stick to your guns. On the other hand, if it’s something unimportant, it may be better to let it go and move forward.
#5 Read up on the process of buying a home
You wouldn’t go rock climbing without taking a safety course first, right? You wouldn’t jump in a pilot’s seat without knowledge of how to fly a plane first either, would you? Obviously, you would not. So, why would you enter into the stressful and time consuming world that is home buying without at least a little understanding? Your agent will know the ins and outs, but you will benefit from preparation for yourself. You want everything to go smoothly.
Know your part in the process. You are the buyer and the other person/financial institute is the seller. The home may be a traditional sale or it may be a short sale. Know the key words, time constraints, and contract obligations. You will be legally binded to comply with your contract when you sign your John Hancock on the dotted line. It could cause grave and costly consequences for failure to do so. Read articles on escrow. Look for blogs about appraisal. Check out a book that explains the lending process. Ask questions! Do whatever it takes to gain knowledge of fundamental terms and conditions. Protect your desire for a successful closing on your new home.
#6 Realize that YOU are responsible for YOU!
There is no one person who is responsible for your staying “pre-approved”, but you. Keep your credit score up during this process. Don’t go on a shopping spree with your credit cards or make big purchases while trying to obtain a mortgage. Believe it or not, they are still watching you and your creditworthiness until those final papers are signed! Follow the advice of your lender and agent. Don’t sabotage your own opportunity.
Also, treat others with the respect that you would want. Don’t take your frustrations out on the people trying to help you, and be courteous when entering and observing a seller’s home.
#7 Don’t worry, Be happy!
Yes, it’s stressful yes it’s one of the biggest purchases you’ll ever make. Yes, it is a life changing event. Home buying isn’t all roses and rainbows. However, it is also one of the most exhilarating experiences you will ever go through. Enjoy looking at beautiful homes. Laugh with your lender and be up beat. Befriend your agent. Just take a deep breath and enjoy the ride. It’s one you’ll never forget.
What does it all mean?
Basically, you don’t have to feel like someone is driving bamboo sticks under your fingernails when you’re trying to buy a home. Gain knowledge of the process, smile when you feel like screaming, enjoy yourself, and know that you WILL finish this. I can’t guarantee these steps will make your experience a pleasant success, but if you follow them, you may increase the chance that it will be.