The #1 Reason It Is Difficult to Find Your Dream HomeThe headlines in real estate today all revolve around one major point: there is a shortage of homes available for sale. Price appreciation
7 Things To Do Before House Hunting
7 Things to Do Before House Hunting
House hunting can be overwhelming, especially if you’re a first time buyer.
You have to think about the location of the property, square footage, layout, finishes, flooring, and oh yeah — getting a mortgage. The list is endless.
It’s exciting and exhausting at the same time.How do you even know where to start in the process?
Whether you’re hunting for your very first house or your fifth, the process will be much smoother if you have a plan and a house hunting checklist.
If you’re jumping into the real estate market, here are 7 things to do before you start house hunting.
1. KNOW YOURCREDIT SCORE
First things first: don’t go house shopping without getting a mortgage pre-qualification.
Have you founda house online you’re just dying to see? Don’t pull into thedriveway until you’ve talked to a mortgage broker first.
There’s nothing worse than putting in an offer on your dream home, only to find out you don’tactually qualify to purchase it. That’s unnecessary frustration not only for you, but for the sellers and realtors as well.
Your credit score in particular is important because only two things determine the interest rate you get on your mortgage: the amount of your down payment and your credit score.
There’s nothing that will kill a sales contract faster than finding out you can’t qualify to buy a home. If you find out your credit isn’t up to par to buy a home,work on fixing it first, and put your house shopping on hold for a while.
Don’t panic — there will be plenty of homes available once you’re able to start your search again.
Get your credit score first before you apply for a mortgage
2. Have a BUDGET
You should decide ahead of time what amount you’re comfortable with paying per month for your mortgage. Then go to your bank for your pre-qualification letter OR contact a trusted loan officer.
Hopefully you already have a budget and know what will work for you and what won’t, but if you don’t, now is the perfect time to start one. It’s important to dobeforeyou have a mortgage payment.
A budget is important because by using one, you’ll always be aware of where your money is going. If you currentlyuseone, then you’ll already have a good idea of how much you can comfortably afford.
Don’t get starry-eyed and blow your budgetif your loan officer tells you you’re qualified to purchase a more expensive home. Know your max, and stick to it.
A budget will also help you determine how much you can afford to pay for utilities, furnishings, and decorations for your new home. It’s easy to get carried away with buying new items for your home, but a budget will help you manage these expenses.
3. FIND A DILIGENT REALTOR
The next step is finding a realtor who will workforyou. You want someone who will stand up for you in the final walk-through or at the closing table if something doesn’t go right.
You also want someone who has lived in the area for a long time, who knows the market, and who is knowledgeable about the costs of home repairs and upgrades.
A good realtor can point out problems with potential homes before you get too attached to them. I appreciated having a realtor who pointed out disadvantages to specific properties, especially as a first-time home buyer without good knowledge of basic home repairs.
The best way to find someone who will work hard for you is to ask for recommendations from friends and family members. (The same rule applies to finding a reputable mortgage broker.) I’ve seen many bad realtors and many great realtors, so if your realtor isn’t working for you, find a new one. There’s not a shortage of realtors these days, so make sure you are happy with yours.
4. MAKE A LIST OF NEEDS, MUST-HAVES, AND WANTS
You may end up seeing so many properties your head will be left spinning. You might forget some of the things you were looking for in the first place. Take a notebook with you to write down the things you liked and the things you didn’t like about the home – take photos if you can. Before you look at any houses, make a list of your needs, must-haves, and wants. This way, if you get overwhelmed after seeing toomany homes, you can simply refer back to your list and remember what it is you’re looking for. This will also be helpful for your realtor to reference as well.
Making a list of all your wants and needs when it comes to buying a house is essential!
So many people say that when you walk into therighthome, you’ll just know. That certainly isn’t true for everyone. Don’t let anyone tell you it will be love at first sight, because that doesn’t always happen, especially if you’re in the market for a fixer-upper or a foreclosure.
5. CHOOSE YOUR LOCATION
It’s going to be really hard for your realtor to show you the best housing options for you if you don’t know thearea you want to reside in. You’ll end up all over the place if you don’t.
If you aren’t sure about your specific location, spend some time in the areas you’re interested in at different times of the day to get a feel for the area. Goodtimes to visit are rush hour times and nighttime.
Afterward, ask yourself these questions:
Do Ifeel safe there?
Is there an abundance of traffic at rush hour?
Is it on a busy road?
Does the neighborhood look clean and well-kept?
Choosing a set location ahead of time will help narrow down the list of properties you see. It will also help you avoid seeing tons of houses that are in a less than desirable location.
6. SAVE AN EMERGENCY FUND
If you don’t have an emergency fund saved yet, buying a house isn’t a wise option.
Houses mean constant maintenance, even if you buy new. You don’t want to be caught without heat in the dead of winter just because you can’t afford to fix your furnace.
You also don’t want to be forced to pay for it on a credit card when you realize you really can’t live without heat. Don’t put yourself in this position and end up sinking. Save for emergencies.
7. CHECK YOUR EMOTIONS AT THE DOOR
Buying a house is an emotional process, but do your best to keep your emotions out of it before you make a hasty and unwise decision about a house that’s financially out of your reach.
Buying a house is a business transaction, so play it cool and keep your emotions in check. You’ll be thanking yourself later. Happy house hunting!
Steve Humphries, Broker & Co-Owner of EXIT Realty Champions, has been in the real estate business since 2004. Collaborating in business and life with his wife and fellow broker, Deirdre Lucey-Humphrie....
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