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5 Important Steps to Take When You’re Ready to Buy a House

buying a home

After working hard and saving money, you may be ready to leap into homeownership.

Owning your home can be rewarding, especially since you no longer worry about eviction or increased rent.

You can also enjoy the security and stability of owning your home and building equity and financial stability.

It can also be a scary step for first homebuyers when you aren’t entirely sure how the process works. Consider the following five steps when you’re ready to buy your own home.

1. Talk to Realtors

Talking to realtors from reputable agencies like Odigo Real Estate Club can help you understand what the property market is doing in the areas you’re interested in and what properties are available within your potential price range.

Talking to realtors will answer questions and even help you learn about off-market properties if nothing listed catches your eye.

Off-market properties refer to properties that are likely to be listed shortly or will be ‘quiet’ listings with no signage or marketing materials.

When you ask to be informed about off-market listings, you get a sneak peek, which can sometimes equate to more time to make your decision.

Realtors can also be an excellent source of knowledge and can form part of your support system when the time comes to start house-hunting in earnest.

However, before you get too carried away with some homes that have grabbed your interest – you need to know who will offer you a mortgage.

2. Get Pre-approved

While there’s nothing wrong with browsing listings online before getting a mortgage pre-approval offer to learn what you can afford and progress beyond just dreaming, pre-approval is essential to buying a house.

Did you know you can get pre-approval for a home loan with different lenders? Doing so helps you understand how much you can borrow, the costs, and repayments so you know the most you can offer on a property.

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Pre-approval can be obtained directly from a lender, such as a bank, or with the help of a mortgage broker. Mortgage brokers can connect with multiple lenders and help you secure the best home loan terms. Once you have pre-approval, you have a fixed number of weeks to find a property before requesting pre-approval renewal.

3. House-Hunting

With fresh pre-approval offers burning a hole in your pocket, it’s time to hone in on specific houses of interest.

Create a list of what you need and can do without in a home. To identify what matters to you, ask yourself questions. For example, is location more important than the number of rooms? Do you need a detached home, or will a townhouse better suit your requirements?

Research areas you’d like to buy in and learn what types of properties are selling for in those areas that meet your needs.

Extend your knowledge of an area you’re unfamiliar with by visiting it regularly and finding out from locals how safe it is. Is the area growing, has good employers, and what are the facilities and services like?

You may also wish to learn about the likelihood of appreciation and any developments planned for a neighborhood you’d like to buy in.

Use online tools to collect data on property prices (general property listing sites will give you this information). Additionally, look at local government records and financial analysis tools to gauge the strength of the local economy.

4. Do Your Due Diligence with an Inspection

Once you’ve found what you believe is your dream home, it can be tempting to buy it immediately. However, making an offer subject to conditions like a builder’s inspection can be a good idea.

Inspectors can look for potentially costly issues that may stop you from enjoying your house to the fullest, such as roof leaks, foundation issues, and any electrical or plumbing problems. They can also highlight things that may become problematic so you can plan.

Due diligence in house-buying typically involves a title search for hidden liens and a land survey to identify boundaries, features, improvements, and any disclosures you need to know. For example, a disclosure statement might reveal issues with the housing foundation, an environmental hazard, or unpermitted renovations.

Most due diligence periods are an average of one or two weeks, giving you plenty of time to enlist the services of experts to learn as much as possible about your potential new dream home.

5. Start the Closing Process

After a home seller accepts your offer and you’re happy with your building inspector’s report, you can start working through the closing process. Closing on a property sale involves signing documents, making a downpayment, and covering closing costs.

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Closing costs typically include:

  • Title fees
  • An appraisal
  • Property taxes
  • Attorney fees
  • Escrow fees
  • Homeowners Insurance

Costs can vary for each property, and some fees may be negotiable with the home seller. Once these costs are covered, you can start moving into your property and celebrate being a new homeowner.

Summing Up

Buying a new house is not a one-step process. It can involve talking to realtors, researching the market, performing due diligence, and navigating the often lengthy closing process.

However, you will know what success means when you can reap all the rewards of homeownership, like housing security, the freedom to make changes, financial stability, and building equity. If the time has come to step onto the property ladder, don’t delay taking these five crucial steps.