The 5 Steps of Buying a Home
So, you are ready to get off the rental treadmill and jump onto the property ownership ladder? Purchasing your first house can be one of the most exhilarating experiences, but you would be forgiven to feel a bit daunted by the entire process. After all, as an individual who has never experienced the hoops of the process, chances are you do not have a clear understanding of what is involved.
So, to help make things easier, here are 5 steps of the homebuying process:
Do Your Homework
Purchasing a house might seem challenging at the outset, but just a bit of preparation can really go a long way. This implies having your finances in order, creating a budget, and having a savings goal that can help you amass the amount required to qualify for a home loan.
One of the most important questions to ask when deciding to take a loan is how much you can borrow.
Check with the mortgage broker about the available types of home loans that fit your situation as well as the repayments involved. Generally, lending institutions require about 20% of the home’s buying price for a deposit, but there are several other fees to keep in mind. For example, loan set up costs, legal fees and stamp duty all come into the equation.
You might even qualify for government incentives if you are a first-time homebuyer. Each territory or state has its own distinct rules regarding this, and so, ensure you comprehend the criteria before you apply.
Once you have an idea of the costs and fees involved, you can begin to put your finances in order. As a starting point, consider aiming to save enough to cover the deposit and bit extra. This will help you avoid additional costs such as lender’s mortgage insurance by showing the lender that you have reliable savings habits.
Find a Home
With the financial foundations laid down, it is time to get into the exciting stuff. When looking for a new house, even with specs in mind, you will come across a wide array of options, and with it comes a lot to consider. However, with an excellent professional by your side, the process should be less daunting.
Prior to house hunting, you will want to consider your primary house requirements. Create a list based on the following factors:
1. The Type
What type of house do you want? A condo, townhouse, or single-family detached house?
Things to consider include Sq. footage, desired layout and floor plan, number of bedrooms, storage, and outdoor area.
What is the traffic like? What is the crime rate? Are amenities easily accessible? What about schools?
4. Resale Value
In this aspect, you will want to consider the neighborhood, house features, landscaping as well as recent upgrades.
How much do maintenance and upkeep cost?
Another important thing to consider is if you should get a new construction or older home. The latter tend to be priced low enough if you have a generous renovation budget and often have more character. However, you might be dealing with a dated design, older appliances, less energy-efficient, and out of date systems. With the help of a real online estate agent, you should be able to find a home that matches your needs and personality.
Before you make an offer, there are several things you will want to do to ensure you are getting the real deal. This entails things like a pre-purchase pest and building inspection. You may have cast an eye over the house during open house or walk-through, but a reputable inspector is bound to pick up on both major and minor issues with the home that might set you back financially down the line.
With this information, you will be better armed when it comes to negotiations.
The Buying Process
After making an offer, the next step involves signing and exchanging the relevant documents. Until this stage, you and the seller have the option to pull out of the arrangement. The rules around purchasing real estate vary from place to place and the buying means. To ensure you are not caught out, have a lawyer on board to help you better understand the buying process. Some regions have a few days of the cooling-off period, while others have none.
Moving into Your New Home
Once the contracts are signed and purchase finalized, you can now finally move into your dream home. At this stage, you will need to hire removalists or movers to help you with the daunting process of moving your possessions from one location to the next. Once the dust has settled, you can now sit back, sip a drink, and enjoy your new place.
After you have settled, you can now shift your focus towards paying the mortgage and keeping up with the daily expenses, such as utility bills. Of course, this should not prevent you from savoring everything that owning a home currently brings.