How to Prepare to Buy a Home
Buying a home might just be the biggest investment you’ll ever make. And even if you’ve purchased real estate before, no two transactions are the same.
Here’s how to get ready to buy a new house:
- Timing is everything
Is it the best time to buy a home? It’s less about current mortgage rates and market conditions, and more about financial capacity. You can enter the market if you’ve built up your savings, you have steady employment, and you intend to stay put.
Generally, it’s advisable to buy a home if you plan to live in it for at least five years. This allows you to recoup the costs. But if relocating for work, education, or marriage is in the cards, then you might want to put off the purchase.
- Get your finances in shape
Aside from building your savings and having a steady source of income, you need to take care of your credit score. This increases your chances of getting approved for a mortgage, and at a higher amount.
Ask your bank for a copy of your credit report. Put off major purchases in the months leading up to your loan application. Minimize or consolidate your existing debt, and make payments on time.
- Shop around for a mortgage
Talk to multiple lenders in order to get the best rates and loan amount. Gather all the necessary documents and identification needed for the application process. The lender will ask you to disclose information in order to verify your background. This covers your monthly income, account balance, debts, employment history, where you’ve lived, and so on.
- Find out how much home you can afford
It’s easy to get carried away during house hunting, but determining how much home you can truly afford will help narrow down your choices. Too many buyers end up house poor – that is, living in a nice home but not having enough cash for monthly expenses and personal emergencies.
Not only does pre-approval prevent you from choosing a home beyond your price range, it also keeps you from settling for a house below the amount you can be approved for. This helps you maximize your resources and find a property that suits you.
- Work with a Realtor
A Realtor will help you get ready to make a home purchase, as well as guide you through the rest of the buying process. Hire one who knows the local market in and out. They can give you valuable insight and advice.
The Hensley Group specializes in high-end Temecula and Murrieta real estate. Call me, Marcel Hensley, at 951-252-9088 or send an email to marcel(at)thehensleygroup(dotted)net.
- Schedule open houses
It’s worth taking the time to view homes personally. Block off your schedule for open houses, and prioritize the homes that you are most interested in. Your Realtor can help come up with a schedule that will help you make the most of your time. For instance, they can arrange for you to attend multiple open houses in the same neighborhood within a single day. This will make your trip to the area worthwhile.