Are your ready to purchase a home? Some tips to get you ready.
Before you start looking to purchase a home, you need to have realistic expectations. Do you have an idea what your true budget is? Can you differentiate between needs and wants?
Understand what you are capable of borrowing. Obtain a pre-approval from a reputable mortgage broker and figure out what PITI (Principal, Interest, Taxes, and Insurance) payment you can afford. Don't tell them what you want to spend. Let them tell you what you can afford, based upon your employment history, credit history, income, and assets. That amount may still be too high for your taste. Let your Realtor what you want to spend as a maximum.
You only need to get one pre-approval; so you don't need to shop around. However, you don't have to obtiain your mortage from the lender that did your pre-approval, so shop around for the best rates and fees. And look for a loan officer that promptly returns calls, is willing to answer questions, and is genuinely interested in getting you the best loan product.
Before house hunting, make sure you understand what you "must haves" are and what your "nice to haves" are. Be prepared to make trade off to maximize meeting your "must haves." Also, make sure to look past the owner's style and color choices. Their furniture and furnishings won't be there when you move in, so make sure you are in love with the house, not how it shows. Also, paint is easily fixed. Better to purchase a home that needs a bit of painting rather than one that showed good but has problems that aren't cosmetic.
If you are a first time home buyer, make sure your expectations are realistic. You are not likely to find a home that doesn't need some work to it to make it yours. However, homes that have major issues should be avoided. As a buyer you should be looking for other tell tales of problems with the home before you make an offer. You will be getting a home inspection before you finalze a purchase contract, but that could be late in the process if you've already fallen in love with the home. A dispassionate look at the house before you make an offer can save you many headaches. Look for cracks, unlevel floors, water stains, etc. before you write an offer.
Make sure you allot enough time for the process. The process will usually take longer than you anticipate. Searching can take weeks or even a few months. And then there is time between contact and closing.
Ultimately, the more realistic you are as a buyer, the smoother the process will go. Your Realtor is your advocate, and will guide you through the process, so listen to their advice.