Cervone Deegan + Associates knows firsthand that buying a home has many moving parts to the process. Before you get too excited by imagining all of the entertaining you will be doing in your new living room, you will want to make sure you are best prepared for making this huge accomplishment. Here is a list of things that you will want to both do and avoid while you get yourself ready and well-positioned.
What To Do
Check your credit - Your credit plays a big role in qualifying for a mortgage. Make sure you check yours to know your score and review for accuracy.
Get pre-approved - Contact a lender to get pre-approved for a mortgage to see what you can ultimately afford. You can shop lenders for the amounts of the fees that are charged as well.
Contact an agent - Contact a professional real estate agent such as Cervone Deegan + Associates to learn about local market conditions and ultimately help you find a home in an area of your choice.
Decide on a neighborhood - Chances are there may be more than one area that will work for you. Start by visiting some open houses and driving around at various times of day to really get a sense of what an area is like. See the people and observe the noise level and activities.
Maintain finances - It is important to maintain your consistent financial status during the entire house purchase process for home loan qualification purposes. Avoid starting new jobs, opening new accounts or making large purchases at this time. Give some thought as well to how you will budget for future home improvements during this time too.
Locate a home - When searching for a home focus on a home’s potential rather than adhering to a strict checklist. Especially during current times of slim inventory, you want to be open to as many options as possible. Walls can be painted and rooms can be updated so long as the core structure and location are things you can work with.
Shop for insurance - Insurance is something you can shop around for and check for different companies, and rates, search for bundled discounts, or check if your home has qualifying status for discounts like an alarm system or the like.
Pay attention to data security - A lot of personal information is exchanged during a home purchase so be mindful of who you are providing your personal details including social security numbers, bank info, and the like. Make sure to work only with trusted and reputable professionals.
Review closing docs - Your closing documents are very important as they are what binds your deal. When you are given your final versions a few days before closing, be sure to review thoroughly and audit for accuracy, check the correct spelling of names, etc, and make sure amounts are what they should be.
What Not To Do
Search for a home before pre-approved - Don’t get yourself excited by looking at a home before you know if you can afford it. Only a lender will be able to realistically tell you what you can spend.
Don’t wait to save 20% for a downpayment - Yes, 20% is ideal to put down to avoid paying mortgage insurance but there are many home loan programs that allow for much less, some as little as 3.5%!
Don’t get emotional - Try to keep it all business so you don’t regret making any rash decisions. Also, it is not uncommon to get outbid on a home these days too so keep your chin up and stay focused. There will be another opportunity.
Don’t skip your research - Don’t just go by what a listing description may say - be sure to view homes in person and follow up with a home inspection on a home you submit an offer on. Also, don’t just go by simple mortgage calculators for estimating payments. Not all include everything such as an HOA due, extra insurance like flood needed, or the like.
Don’t forget about closing costs - Oftentimes buyers are so focused on saving for a down payment that they forget about closing costs - and those can be substantial too. Expect this to fall somewhere between 2 and 5% of the purchase price.