You can never have too much information when shopping for your home.For most of us, buying a home is by far the biggest financial decision we will make in our entire lives. It can seem like a very intimidating process, especially for first-time home buyers. That’s why we’re here to break it down into a simple, step-by-step plan so that anyone can prepare to buy their first home!
Make up Your Mind! (Research)
Before you should even attempt to search for potential properties, it’s crucial that you narrow your search by finding out what your priorities and preferences are. Here are some sample questions to get you started:
How much can I afford? (Both monthly payment and down payment)
How far am I willing to commute to work?
How many bedrooms/bathrooms do we need?
What areas have good schools?
Which neighborhoods are safe?
Will this house be a good investment in the long term?
Are we willing to renovate a property or are we looking for turn-key?
Gather your Financial Information
If you want to qualify for a home mortgage loan and get the best interest rate possible, you’re going to need a few things: a good credit score, at least two months of bank statements, and about two years of federal tax returns.
Generally a credit score of above 720 will get you better rates, which could save you tens of thousands over the lifespan of your loan. Also, having these documents ready will save you time and hassle once you begin talking with a lender.
Once you provide these documents, they will pre-approve you for a loan amount they believe you can afford. This will come in handy when you place an offer on a home that already has multiple offers.
Find a Trusted Real Estate Agent
Having a real estate agent by your side will ensure that you consider every facet of the
home buying process and save you from making any costly mistakes. Their professional knowledge will make your transaction a lot less scary and they will work their hardest to find the best home for you!
If you are looking in the Colorado Springs area or anywhere in Colorado, Brent Mahagan and the team at Pink Realty will be happy to guide you through your next home buying experience!
Tour Homes and Make an Offer!
Now for the fun part! Take into consideration the questions that you asked yourself during the first step. Make sure you communicate your needs and preferences to your real estate agent so that they may best serve you in finding your home. Also, depending on your budget, you may not be able to fulfill every desire that you wanted to see in a property. It may be more important to have that extra bedroom for your future child rather than that in-ground swimming pool and tiki bar.
Once you have found a home you can see yourself in, now it is time to make an offer. Your agent will help you out by providing information about the local housing market so that you will know whether to place your offer lower or higher than the listing price. Also you can determine whether there will be contingencies or an inspection needed upon acceptance. After that you will either hear back a “Yes”, “No”, or a counteroffer. If you can’t come to a deal, back to searching! However, if they accept your offer then onto the next step!
Home Inspection, Insurance and Utilities
Having a Home Inspector look over the house can help you find unseen issues and can even provide room for a little extra negotiation. This time inside the home can also allow you to get measurements for furniture, and decide what your floor plan will look like.
When buying a new home, you will need an insurance agent to write up a policy for you and make sure that you have the coverage you need to protect you and your home.
You will also need to provide the utility company your move-in date so that you can schedule your payments and avoid spending your first night with no shower and a candlelit dinner.
Closing Day and Move In
The moment we’ve all been waiting for! You will read and sign many papers on closing day, as well as pay any closing costs that are necessary. The amount usually varies between 2 and 4 percent of the purchase price of the property.
After that you will receive your sale contract with your move-in day on it. And the final step: breathe a sigh of relief that you successfully completed the home buying process and can now enjoy every square foot!