What are the Steps in Buying a House
There are a lot of steps in buying a house that you need to follow. These tasks require time, patience, effort and money so be sure that you are prepared for it before you decide to go through with it. Also, you need to understand each step so that it will be easy for you to get through with each of them. This will make your purchase hassle-free and quick.
Buying a House
The first step that you need to do when buying a house is to make that final decision to make the purchase. Yes, you may want to buy a house now but you are not yet decided if you are going to do it now or in the near future. Decide if you are ready for it and when you want to do it. This way, you won’t have second thoughts in the middle of the purchase process.
Once you decided on the purchase, it’s time to go through these steps. These tasks may seem overwhelming but if you prepared for it and did enough research about it, you will be just fine.
- Research in advance.
Research everything that you will need for purchasing a home. The money that you need to save, the documents that you need to prepare, the agencies that you need to contact, the timeframe of the procedures that you will go through and the laws and rules in buying a house are all vital info that you need to prepare for a house purchase.
- Know how much you can afford.
Knowing the price that you can afford is a good idea before you start looking for homes for sale. You will also determine the amount that you have to save for down payment once you know how much you can afford.
You will determine this by getting a pre-approved mortgage. Your financial capabilities will be computed to determine the price of home that you can afford. You can also do a rough estimate by determining your monthly income and your debt-to-income ratio.
- Save money for the down payment and fees.
If you want your purchase to go smoothly, you need to save for your down payment and fees. The down payment is usually 20% of the selling price of the house while the closing fees that you have to pay will be between $2,000 to $5,000 dollars for a $200,000 loan.
If your finances are good and you can get an 80:20 mortgage loan, you can try for that kind of home loan so that you don’t have to save for down payment. Be wary, though, that this kind of loan often has higher monthly mortgage fees since you are paying your down payment though a kind of loan as well.
- Get an agent or start the process on your own.
If you decide to use a realtor for the purchase, the steps that you need to do will be lessened. Since your agent will be the one dealing with agencies and professionals most of the time, you won’t have to worry about other tasks such as looking for houses or having a lawyer draft an offer or sales contract.
If you decide to do it on your own, you have to follow the steps below.
- Look for houses and schedule viewing.
If you decide to buy a house directly from the owner, you can start looking for houses that are within your budget. You can look online, drive around your preferred neighborhood to look for houses for sale by owner, look through realty magazines and post and check out ads online.
Once you have a list of the houses that you want, you can contact the owners and set a schedule for viewing. This can take from a few days to a couple of weeks, depending on the number of houses that you want to view.
Once you select a house that you prefer, you can have a real estate attorney draft an offer for you, or if you have an agent, let your realtor do it for you. You can submit the offer to the owners of the house so that you can request for a home inspection and appraisal to determine the value of the house and also ensure that you are paying for the house for a fair amount.
- Do a home inspection and appraisal.
This is one of the most meticulous things since you and your appraiser and inspector will be putting the house to scrutiny to see the most accurate value of the house. If you see damages and problems in the house, you should inform the inspector and appraiser so that they will be aware of those. It can help lower the selling price of the house.
This is important if you are aiming to get a low or zero-down home loan.
- Deal with paperwork.
Whether you are buying directly from a seller or having a realtor do the paperwork for you, there will be times when you will have to do these things. You have to ensure that everything is clear and fair before signing everything.
The seller will also do the same until you reach a final agreement. If you have an agent, the paperwork should be handled by him/her once the agreement is set.
- Close the sale.
This is the last and one of the most exciting steps. You will sign all the necessary documents, make sure that the check was given to the seller and move in to your new home.
You won’t have to pay your agent for his/her services, if you got one, since they will be getting their commission from the selling price of the house.