First Steps - Buyers
Are you wondering..."What should I do before I begin looking at houses?"
Watch this video to learn about the most important first steps.
Or continue reading below.
The idea of homeownership is thrilling, but the thought of making one of the largest financial investments of your life can feel overwhelming.
Good news! The steps to homeownership are easier than you think, especially with a trusted realtor at your side. And in Texas, nine times out of ten, there is no cost to the buyer for the valuable service provided by your realtor.
This article will discuss the first 4 important steps towards achieving your goal of homeownership.
1. Choose a lender and get pre-approved for a loan.
I recommend not even looking at houses—online or in person—before you take this step. If you do, you are setting yourself up for disappointment. Most sellers will not accept an offer without a pre-approval letter. By the time you get approved, the house may be under contract, above the price you're approved for, or you may need to address a couple of issues with your credit before getting approved for a loan.
If that happens and you decide that house was “THE ONE”, you’ll end up comparing all future houses to that one and might find they just don’t measure up.
So save yourself that headache and get pre-approved first. For more information on choosing a lender, click here.
An important note about lenders…they are NOT all the same. A bad lender can be the reason a deal falls apart. Ask your realtor for recommendations. And don’t assume your bank is your best resource; they are often the worst when it comes to bad surprises and delays. Feel free to reach out to me for more details on what to ask before deciding on one.
2. Downpayment and Closing Costs
The good news is you do not need a 20% downpayment to buy a home. There are many programs available, that will allow you to put down 5% or less, especially if you haven’t owned a home in the last three years. Depending on the area you’re looking in, you may even be able to put as little as zero down.
In addition to the downpayment, you’ll need to have enough to cover your closing costs and lender-required escrow prorations. Your realtor or lender can help you figure out how much money that might be. And sometimes you can try to roll some of your closing costs into the price of the house. Just be careful with that, because a low appraisal could take that away from you. Ask your realtor for advice.
3. Choose a Realtor
The best thing you can do is work with a trusted realtor. As I mentioned earlier, in Texas 9 times out of 10, there is no additional cost to the buyer for enlisting the services of a realtor. There are so many important things to know and do in a real estate transaction that it’s important you have someone representing your best interests.
Remember, the seller’s realtor or builder’s agent is looking out for the best interest of the seller, not you.
And just like anything else, not all realtors are created equally. Look for reviews on agents. Ask for referrals. Find a personality you enjoy working with, someone you feel comfortable with. Remember, this is one of your biggest financial investments. So have an advocate on your side.
4. The fun part. Start looking at houses.
Your realtor will help you fine-tune your house search with an in-depth needs analysis.
- What area of town do you want to be in?
- How big do you want the house to be?
- Are schools important?
- What features are you looking for?
- What are your must-haves?
- Are you willing to make improvements or do you want it move-in ready?
Your realtor will help you look for houses and set up search alerts for any new homes that meet your criteria.
In addition to the needs analysis, your realtor should educate you on the buying process and review the contract with you so that you’ll understand what you’re signing when you make an offer.
OK, so all of this may sound like a lot, but with the right realtor on your side, it won’t be overwhelming. They’ll walk you through every step along the way and make the process as easy as possible.
I hope this has article has gotten you one step closer to your dream of buying a home. I would love to be the realtor you choose to make that dream come true.
Call me for a free consultation.
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