|Home Buying Advice that Helps Put You In a House
A Step By Step Look at Home Buying
The specific way you progress through a home buying transaction varies depending
on the real estate laws and customs where you live, but there are many home
buying steps that are standard, even though they might not be accomplished in
the same order in every location.
You'll feel more confident about your home buying journey when you understand
what is required of you and every other person who is involved in the
transaction. This guide takes you through it, and shows you that you're only 11
steps away from buying a home.
Step 1. Get Your Finances in Order
Your credit reports are an ongoing look at how you manage your finances. You
must know exactly what your credit reports say about your financial history
before you apply for a mortgage, because the reports play an important role in
the mortgage approval process and in determining the interest rate and other
loan terms that a lender offers you.
If you haven't looked at your credit reports, you might be surprised at their
contents, because errors are common.
Step 2. Get Familiar with the Mortgage Industry
Finding the right loan and lender is crucial to your home buying success.
It's up to you to determine which lender is best for your needs, and it's always
a good idea to have at least a bit of background about the loan process before
you talk to a lender.
Step 3. Get Pre-Approved for a Mortgage
Do you know how much house you can afford? Probably not, unless you've talked
with a lender.
Pre-approval helps you in other ways. Consider this scenario. A home seller gets
two similar offers. One is accompanied by a letter from the buyer's bank that
states she is pre-approved for a mortgage in the amount of the offer. The other
has no supporting documents. Which offer do you think the seller will consider
Step 4. Determine Your Wants and Needs
Buying a home isn't as difficult as you might think, even if you're short on
funds, but the process will go a lot smoother if you get familiar with your real
estate market and narrow down your wants and needs before you start looking at
Step 5. Learn to Work with a Real Estate Agent
Real estate agents represent buyers, sellers, or both--and in some states they
can work as neutral facilitators for either party. It's essential to understand
agent duties and loyalties before you make that first phone call.
Step 6. Start Searching for a Home
Your agent will give you exclusive and multiple listing sheets to study. I'm
sure you'll also pick up House For Sale magazines and read classified ads in
your local newspapers. You'll probably spend time surfing the Internet for
homes. You might even plan afternoon drives to preview neighborhoods. Those are
all excellent ways to see what's available. Here are some tools to help you
narrow your home buying search.
Step 7. Handle Pre-Offer Tasks
Deciding whether or not you want to buy a house involves a look at its structure
and its features, but there are many other topics that are every bit as
important to your purchase.
Here are a few topics you should explore before you make an offer.
1. How's the Resale Potential?
2. Contract Contingency Basics
3. What Kind of House Is It? Site Built, Modular, Manufactured
4. Do Others Have a Right to Use the Property?
5. Can You Live with the Deed Restrictions?
6. Is the Heating System Efficient?
Step 8. Make an Offer
There's no one set of instructions that can cover all the differences in real
estate laws and customs that exist throughout New Brunswick, so the mechanics of
making an offer and its specific contingencies depend greatly on your location.
However, there are some home buying tips that can help you fine-tune your offer,
no matter where you live.
1. What Comes With the House? Contract Considerations
2. What Should the Seller Disclose?
3. Decide How Much to Offer
4. Asking for Possession Before Closing
Step 9. Home Inspections and Other Tests
No matter when you do them, it's critical to decide which inspections and tests
you want to perform.
Talk with your real estate agent or other advisor to find out when inspections
should be handled and if additional types of testing are important for your
1. Order a Full Home Inspection
2. Looking for Molds and Mildew
3. Is There a Private Well on the Property?
4. Understanding and Checking the Septic System
Step 10. Avoiding and Correcting Last Minute Problems
As your closing date nears, everyone involved in your real estate transaction
should check its progress on a daily basis, because staying on top of things
means you'll know immediately if there's a problem that must be dealt with.
Step 11. You're on the Way to Closing
Most of your home buying problems are behind you now and you're on your way to
closing, also called settlement, the event that transfers ownership of the
property to you.
The steps outlined in this article are a general home buying guide. You will
encounter issues specific to your location and your transaction, issues that can
best be explained and handled by your local real estate agent, your lender, your
attorney, your closing agent, or others who are helping you complete the home
Never hesitate to ask questions. Ask as many questions as necessary to help you
understand the entire home buying process. You are making a long-term commitment
and spending a major amount of money--you'll feel much better about the
transaction if you stay informed and understand what's happening every step
along the way.