Home Buying Process

Buying a home is something the average person only does once or twice over the course of a lifetime. In other words, it isn’t something you do every day. This can mean the home buying process may seem a little foreign or even alien to you. That’s OK. The key to buying a home is to find simple solutions, like a step by step plan, that makes the process feel more familiar and less confusing.

Step 1 – Check into Your Credit Situation

Credit reports play significant roles in your ability to obtain credit for a mortgage. Begin by checking your credit scores with the major agencies and looking for errors or problem areas that could result in a denial of credit or higher interest rates. Dispute the errors and take steps to clean up any potential problem areas before deciding to buy.

Step 2 – Determine How Much House You Can Afford

At the very least, determine how much of a monthly note you can afford. Keep in mind that even if a bank is willing to lend you more money for a mortgage, it doesn’t mean you should step outside of your comfort zone. You want to be able to afford the home, some of life’s little luxuries, and still have money left over each month for savings.

Step 3 – Get Pre-Qualified for a Home Loan

Pre-qualifications are not at all binding. They simply determine an amount lenders are willing to lend to you for a mortgage. While they do not bind either party, they do open doors to some homes that are only available to show to pre-qualified buyers. It also gives you a decent ballpark figure, based on your salary and credit history, of how much money you have to work with when searching for a home.

Step 4 – Begin Your Search

It’s a good idea to make a list of must have and like to have features for your home. Then use your budget to further narrow the results in order to find that perfect home that takes your breath away. This is when the home searching process transforms into the home buying process. At this point, it is helpful if you have already gotten your credit in order and have been pre-qualified for an appropriate loan amount.

Step 5 – Deal with the Details

Details in this instance are a multi-step process for buying a home.

  • Make an offer. Sometimes there will be counter offers and negotiations. Other times the seller will bite.
  • Get an inspection of the home. This protects you by identifying any potential problems with the home that might require you to adjust your initial offer accordingly.
  • Select your loan. With pre-qualification this becomes more of a formality but it still needs to become official.
  • Get an appraisal. This is the number lenders will use to assign a value to the home and determine if they are willing to offer the specified amount for that specific home.
  • Go to the closing table. This is where ownership literally transfers from the other party to you. Congratulations!

Homeowners Mortgage has all the tools you need to make the home buying process as comfortable and familiar as possible. Feel free to contact us with any questions about your home purchase or steps you need to take now!

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