Avoid unnecessary yet common mistakes when it comes to buying your first home by following these 4 steps…
1. YOUR CREDIT SCORE
Your credit score may be the single most important element to take into consideration when you begin looking into purchasing a home. To the average American, credit scores are something they typically associate with renting an apartment, or buying and leasing automobiles; however, credit scores also play an integral role when it comes to making the decision to buy a house. Whether it’s an investment property, a studio apartment, or a brand-spanking new McMansion, your credit score can prove to be a crucial factor in determining the size of the loan for which you may be eligible, the interest rate you receive on that loan, and the amount of cash you will be required to pay upfront as a down payment. If you’re looking into becoming a homeowner but think there’s a chance that your credit score is less than ideal, running a simple credit check will give you an excellent idea of where you stand when it comes to buying a home.
2. YOUR BUDGET
It may sound like common sense, but you’d be surprised how few people actual have a comprehensive understanding of their finances; particularly as it pertains to the practicalities of making large purchases. When it comes to buying a home, one of the most important, and frequently overlooked factors, is your budget. Approaching the home-buying process with solid understanding of your finances is absolutely critical. That being said, your budget isn’t objective; it’s what YOU feel comfortable spending, so before you embark on your journey toward home ownership, make sure you figure out what that number is, write it down, and don’t deviate from it as you begin shopping. The housing market can be competitive and when you find that special place that feels like home, the temptation to overspend in an effort to secure a hot property can be tempting, however, you’ll be saving yourself years of financial misery by formulating a practical budget and sticking to it. As is the case with love, there are plenty of fish in the sea, and in time you will find your dream home at your dream price.
3. GO TO OPEN HOUSES
Who doesn’t enjoy checking out new houses? Especially when the houses you’re checking out might one day become your home. In addition to being an enjoyable way to spend an afternoon, going to open houses while preparing to become a home owner serves multiple practical purposes: it lets you see what’s out there, it gives you a realistic idea of what you can get for your money, and it gives you the opportunity to see the texture of different neighborhoods in your area (i.e. shopping, schools, freeway access, proximity to work etc.). If you’re looking into becoming a homeowner, do yourself a favor, and find some open houses in your area to window shop before you begin your serious shopping.
4. USE A REPUTABLE INSPECTOR
Okay, so you’ve found your dream home, you’re in escrow, and on the verge of beginning your exciting new journey as a homeowner; what now? Now comes the (not so) fun part- inspections. Any time residential property changes hands, it is standard operating practice to have an inspection performed. Having a thorough inspection is of the utmost importance in order to ensure that everything is in proper working order and up to code, in accordance with local county laws and terms set forth in the purchase agreement. After forking over a sizeable down payment and dealing with other expenses associated with purchasing a home, cutting corners a bit on an inspector may seem like an economically viable option; however, nothing could be further from the truth. Securing a well seasoned, reputable inspector to perform your inspection will not only ensure that your new home is safe to inhabit but save you a boat load of cash in the long run by going through the domicile with a fine tooth comb and making absolutely certain that everything is 100% copacetic.