You might feel ready to buy a home, but are you truly prepared? Whether you are a first-timer or an experienced homebuyer, buying a home requires a checklist full of things you must do to get the best possible situation. Move into the home of your dreams by fulfilling this to-do list before you buy.
Have a strong credit score. Lenders review your credit score and it plays a role in determining how much house you can buy. Requirements vary from one lender to the next, but they’ve been more strict in recent times as a result of the subprime mortgage lending crisis of 2008. To get a conventional mortgage, you’ll ideally need a FICO score of at least 650. The lower your credit score, the higher the interest rate on your mortgage will be. If your credit score isn’t perfect at the moment, take the time to clean up your credit before applying for a mortgage.
Get pre-approved. Before you really begin shopping, you want to get financing in place. Serious home buyers must have everything in order because buying a home is an extensive process. Get pre-approved for a mortgage so that you know what you can afford to spend.
Define what you’re looking for. Your home is one of the biggest purchases you’ll ever make. Be expressively clear on what you are looking for in a home before you begin your search. Determine non-negotiables as well as the things you are willing to compromise on. Come up with a list of the features, floor plans, and styles that you are most interested in. Also consider other key details, like what type of neighborhood you would like to live in. Share this information with your realtor so they only show you listings you would be interested in.
Find an agent. Ask family and friends, and do some online research to find some local real estate agents who know the area well and have good references. Speak with at least three professionals and discuss your plans with them. The agent you choose should be a full-time sales professional and have at least 5 years of experience in your jurisdiction. Verify that their license is in good standing with the state, and make sure they can show that they’ve closed five to seven deals each year for several years.
Commit to saving. Once you get approved for a mortgage, you’re not done spending. You still need enough money to make a good down payment as well as cover closing costs. Depending on your credit and financing situation, you’ll typically need enough to put between 3.5% and 20% down, plus additional funds to pay your mortgage broker and realtor fees.
Check everything off of this list to make buying a home simpler. The more prepared you are, the easier the process will be.
Mark Long is a real estate agent broker in Irvine. He currently works with Irvine Residential Living, focusing on homes for sale in Irvine and Irvine Condos for Sale.
