Looking to buy your first home? Way to go, sister!
While home buying can be an intimidating process, it’s helpful to know what to expect ahead of time so you can be as prepared as possible.
If you want to absolutely crush your home buying goals (and we know you will), here are 5 tips to buy a home like a BOSS to get you started:
1. Get pre-approved for a mortgage.
This is an important first step in the home buying process. Getting pre-approved will give you a better idea of how much home you can afford and put you in a stronger negotiating position when it comes time to make an offer.
The pre-approval process will involve meeting with a lender to get a loan estimate. This estimate will give you an idea of how much you can borrow and what your monthly payments would be. It’s important to work with a lender who is knowledgeable about the home buying process and can help you find the best mortgage for your needs.
Once you have a loan estimate, it’s time to start shopping around for the best mortgage. There are a lot of different lenders out there, so it’s important to compare rates and terms to find the right one for you.
2. Determine what you can afford.
Just because you were pre-approved for a certain amount doesn’t mean that you should max it out. There are a few things you need to take into account when determining how much your monthly mortgage payment should be.
First, you’ll need to know how much money you can afford to put down upfront, as well as what your interest rate will be. Your monthly mortgage payment will also include principal and interest, as well as property taxes and homeowners insurance. It’s important to factor all of these costs into account when determining how much you can afford to spend on a home.
Another thing to take into account when determining how much you can afford is your other monthly expenses. Your mortgage payment will be a big chunk of your monthly budget, so you need to make sure that you’re comfortable with the other expenses you’ll have each month.
3. Save for a down payment and closing costs.
Get your finances in order. Before you buy a home, it’s important to make sure you’re in good financial shape. This means saving up for a down payment, getting your credit score in order, and budgeting for your monthly mortgage payments.
Having a down payment is important because it reduces the amount of money you need to borrow, which in turn lowers your monthly mortgage payments. It’s also important to save for closing costs, which are the fees and expenses associated with buying a home. Closing costs can add up to several thousand dollars, so it’s important to have the money saved up ahead of time to avoid any surprises.
4. Decide what you absolutely need – and what you can live without.
When house hunting, it’s important to be specific about what you’re looking for. Make a list of your must-haves and wants and refer to it when looking at houses. This will help you stay focused and avoid getting overwhelmed.
Be realistic about your home buying budget.
When deciding what you need in a home, it’s important to take your budget into account. You don’t want to get hung up on things that are out of your price range, so it’s important to be realistic about what you can afford.
Know what’s absolutely essential.
That said, there are a few things that are definitely essential when buying a home. Location is typically very important to most buyers, so researching neighborhoods that fit your needs and lifestyle is a good first step. You’ll also need a place that’s big enough for your family, both now and in the future. And finally, you’ll need a place that’s in good condition and meets all of your safety requirements.
Only search for homes that fit these needs.
Beyond that, it’s up to you to decide what’s important to you. Do you need a lot of extra living space? A backyard? A certain number of bedrooms or bathrooms? It’s important to tailor your search according to your needs and wants so that you don’t waste time looking at houses that don’t fit your criteria.
5. Start looking!
Now that you’ve saved your money wisely and you know what you want, it’s time to go house-hunting! Make sure you hire a licensed realtor that’s knowledgable in the area(s) your are looking at to help get you through the home buying process.
House hunting can be a lot of work, so it’s important to get organized. Create a folder or spreadsheet where you can track all of the houses you’re interested in, as well as their specs and the contact information for the agents. This will make it easier to keep track of everything and make comparisons later on.
Take a tour.
Once you’ve found a few houses that you’re interested in, it’s time to take a tour. This will give you a better idea of what each house is like and whether or not it’s right for you. Be sure to ask plenty of questions during the tour and take note of things you like and don’t like about each house.
Make an offer.
Now that you’ve found the perfect house, it’s time to make an offer. This is typically done through your real estate agent, who will present the offer to the seller’s agent.
Your offer should be based on the selling price of similar houses in the area, as well as how much you’re willing to pay for closing costs and other associated fees. It’s also important to include a contingency clause in your offer, which allows you to back out of the deal if certain conditions aren’t met. For example, you may want to include a contingency that states that you’ll only buy the house if your loan is approved.
The seller will either accept or reject your offer. If they accept it, you’ll move on to the next step in the process; if they reject it, your agent will work with you to come up with a new offer.
Need help with the home buying process?
We recommend working with trusted financial pros (like us!) first to help you get your finances in order. Book a discovery call to learn more about working with us one-on-one, or jump right in to our Home Buying Like a Boss Online Course to DIY it – with expert help!