Searching for and eventually purchasing a home can be a very exciting time in anyone’s life. But before you actually begin the home buying process, there are a few things you should know. Here are some practical tips from The Olear Team:
The home buying process
- Save for a down payment. You’ll want to have some money set aside in your savings account to put toward your down payment on a house. The general rule of thumb is a down payment of approximately 20 percent. That can vary, so be sure to consult with an experienced Realtor.
- Work on your credit score. The higher your credit score, the better the loan rate. A small difference in your mortgage loan interest rate can either save or cost you a lot of money over the life of your loan.
- Select a real estate agent. Your Realtor will be your representative, so choose an agent you are very comfortable working with. A good place to start is by asking friends and family members for referrals. A strong professional relationship with your Realtor can truly make or break the home buying process.
- Look for a loan/lender. Your Realtor should be able to make recommendations, but it’s up to you to decide on the type of mortgage (fixed rate or adjustable rate, for example), and the term (15- and 30-year mortgages are two popular options). The interest rate on a fixed-rate mortgage will never change, and a fixed-rate mortgage is a popular choice if you plan on staying in the home for many years. An adjustable-rate mortgage will fluctuate, but it may be a better option if you’re only planning on staying in your home for a couple of years.
- Get pre-approved for your mortgage. Doing so will allow you to know exactly what you can afford and will also make you a stronger buyer in the eyes of the seller.
- Decide on a location. Where do you want to live? Once you have decided on a community or neighborhood, begin to search online, make comparisons and make appointments to see the homes through your Realtor.
- Decide on a style of home. What’s best for your living situation and lifestyle? Depending on your personal circumstances, it could be anything from a small one-story ranch to a large Colonial with lots of bedrooms and bathrooms for lots of kids.
- Make an offer. Once you’ve checked off all the boxes above, you can finally feel comfortable making an offer on the home of your dreams. This will also be done through your Realtor.
The home buying process is fun and exciting … but it also requires some homework on your part. If you need more information, please contact The Olear Team today!