Let’s cut to the chase. Successfully purchasing a home is one of the more confusing aspects of “adulting.” If you rely too heavily on your go-to BFF or Google, you could end up falling down a rabbit hole of how-tos and old episodes of Fixer-Upper, when Chip had short hair and a gray tooth.
On the other end of the spectrum, if you show up to this home-buying rodeo with your pants down (figuratively speaking), you could end up dead broke and covered in regret. One thing to remember, however, is to make sure your first home is covered properly with an affordable home insurance policy.
So, in an effort to help you bust through the information overload, we had a few experts help us boil down the process. Here are three easy-to-understand stages of the home-buying experience, with sweet tips to achieve the ultimate #adulting bragging rights.
Pump the Breaks and Do Your Prep
Before you start peeking in windows and hitting up open houses, there are certain measures to consider first. Crystal Colburn of Real Estate Excel says the prep work prior to signing on the dotted line is the most important step. With over 10 years of real estate experience, this lady knows her stuff.
- Talk to 2 or 3 lenders about getting preapproval. The worst they can say is no and provide action steps to take towards buying a house in the future.
- Know the terms and the process. Properties Online, Inc. reports that 95% of potential home buyers use the web to aid their search, which is why we wrote this.
- Start saving early. According to Zillow, the median home price is around $200,000, not including extra fees, taxes, or potential renovations.
- Use an expert. Agents provide insider info on the process, neighborhoods, school districts, etc.
- Check your credit. Making sure your credit score is legit can save you a lot of heartache later.
Dos and Don’ts for Now and Later
After you’ve finished your house-buying training regimen by hauling ass across miles of unchartered territory, you can start in on the actual work. Here are some tips to make sure a late payment on your Sam’s Club card won’t bring your home-buying dreams to a resounding halt. True story.
- Make on-time payments on current credit cards and loans. Missed payments could send up a red flag and jeopardize your chances of getting the loan or mortgage rate you want.
- Make a list of your wants, needs, and compromises you’re willing to make. Take this list with you to open houses and be that person asking “a million” questions.
- Do NOT buy beyond your means. Just because you were preapproved for a $250,000 home doesn’t mean you should buy one.
- Keep the future in mind. National Association of Realtors (NAR) reports the most commonly cited reason for selling a home is that it’s too small. The second is to be closer to friends and family.
“More than one in five consumers have a ‘potentially material error’ in their credit file that makes them look riskier than they are,” according to Aaron Klein of CNBC.
After You Finally Find the Right Home
- The process is not over simply because you found a home that fits. While you’re writing offers and filling out applications, remember these tips.
- Keep your finances in check. Just as you should during the search, don’t drop the ball now that you are one yard away from the end-zone.
- Be willing to negotiate on the cost. But don’t forget the additional costs that need to be considered (down payment, closing costs, inspections, utilities, moving costs, renovations, etc.).
- A home inspection is a MUST. The benefits outweigh the costs of a potential disastrous outcome.
Time to Take Home Buying to the Next Level
The NAR reported that 35% of all home buyers are first-timers, but the mayhem of home buying knows no age or level of expertise. First-timers, second-timers and even “flippers” should consider these tips.
We live in an age of information. Use it to your advantage. The hope is that once your foot goes over the threshold of your first open house, or a mountain of paperwork is placed in front of you, you can say with confidence… “I’ve got this.”
Good luck, and make sure you're covered with an affordable home insurance policy.