Stop, there are some wrong and ineffective ways to begin house hunting? You bet, and I observe it every time. In the current environment, where the majority of the people prefers “Zillow” over “Real Estate” as the initial move of a number of homebuyers’ is to go through sites like Trulia, Redfin and Zillow. And Of course why not? As it is casual and occasional as it involves no expectations or pressure Moreover, it is convenient and to be honest it’s a fun activity. It’s all about fun and amusement until or unless you are going out of a contract for being not prepared and beginning your search in an inappropriate way. In most of the cases, the majority of the first-time homebuyers are not aware of their first major mistake which is to set the budge filter without exactly knowing about their affordability. Hence from there, it may waste days even months in terms of following something not acquirable. And trust me, you cannot un-see better and superior properties on the basis of your budget which most of the times leaves the majority of the homebuyers disappointed in terms of moving back. Hence, you must go through the following guide in terms of getting knowledge about how to start the search for your first property before you approach any of Zillow ads in order to attain more information!
Step 1: Obtain a pre-approval letter from a lender of your choice
It is extremely important and always the first thing I advise every home buyer beginning the search. How come? As attaining a pre-approval from any authorised lender or bank will prove useful in terms of getting answers to the following questions:
Can You Even Possess Capability to Purchase a Property?
Most of the lenders and banks will require that you may have three credit open lines. As other lenders won’t be interested to even respond you if you do not fulfil minimum requirements of credit score. Even some of them will recommend issuing a loan in case if you accompany a higher debt-to-income ratio. Moreover, in case if you accompany a short sale association or have filed bankruptcy then you may not even be capable of buying a house for various years.
What is my Affordability?
As your down payment is a major determining factor in terms of loan amount, your lender may also consider your credit score, debt-to-income ratio and interest rate in this regard. It is the most common misconception that someone may afford up to $1,500 in terms of monthly mortgage payment who pays around $1,500 rent per month. Sadly, only your lender may figure out that hence its suitable to analyze that amount before you wish to purchase a property over your budget.
What will be my Interest Rate?
Getting a pre-approval and confirmation from a lender does not make you restricted to acquire a loan from that organisation as it’s just a beginning point. I will always advise my clients to approach several other lenders in terms of finding who offers you the best and most suitable interest rate. In most of the cases, your preferred organisation will compare or try to go beyond an alternative lender’s interest rate in terms of offering you more impressive business deal hence do not hesitate in terms of searching for loans. As even a fractional point may save your thousands in terms of your attainment of the loan! Additionally, you require a pre-approval letter during the submission of an offer in terms of proving your affordability regarding the purchase of a property hence it’s most suitable to acquire pre-approval before the commencement of your search in case if you find your desired one and required to respond instantly.
- Tip: In terms of getting pre-approval, you must have recent profit/loss sheet or pay stubs, account statements, 2 years tax returns or any other evidence of income at the time of your consultation. A pre-approval usually remains valid for a period of 60 to 90 days.
Step 2: Location Settlement
As you are now aware of your affordability, so now you are required to reduce your search domain to one or more surrounding zip codes. What is its importance? As in terms of real estate, your search for your most desirable property, which relates to the quality of properties as per your criteria comparing to the number of listings all over the town. Majority of the people urges to know everything about which is available. My “I’m a Realtor, Believe me”. Answer: No, you exactly don’t. If you go through every property as per your budget in town, you are most probably to:
- Divert your top objectives.
- Waste crucial time.
- Confuse properties.
So, what comes in your major objectives? Everyone has its own, however, you may know to find it among one of the following reasons or a combination of such reasons:
- I want to be near to the line Metro.
- I want to live within the most demanding area of town and within 30 minutes commute to school/work.
- I want a bedroom over a studio.
- I do/do not want a property which requires some cosmetic work.
- I want a property which I may rent out in the upcoming future.
Let your major objectives guide you. If you are aware of them you will probably be happy to live in an amusing, expensive neighbourhood, as you might have to accept the fact that your options are restricted to studios. In case if it’s important for you to have an exterior space, then your options may probably take you beyond the city centre and you may also have to rely on a longer commute distance. Once you have become settled about your desired location, then you are certainly ready to begin going through those listings. However, you are required to make sure you are performing it an appropriate way.
Step 3: Contact Me as Your Realtor
You may ask any buyer and he will explain to you the importance of searching a Realtor who may understand you whenever it comes to the process of home-buying. Similarly like an efficient teacher, an efficient relator will challenge you with a lot of engaging and alluring questions that will make you think beyond your aesthetics. Similarly like an affable bulldog, an efficient and right realtor will make efforts for your interests without undergoing tough negotiations. In terms of investors’ perspective, your realtor must know about all the appropriate parties for you, from inspectors to lenders to contractors, so that you are not required to think and worry about who to approach. Moreover, the right realtor must also drive your style just like a true lover, he must instantly respond to your calls and text messages and must bring champagne for you at the end. Above all and most importantly, your realtor will provide guidance to you throughout the whole home-buying process completely free (seriously, I don’t charge any cost form you). So, why not acquire the services of an expert from starting till the end?
Step 4: Knowing about Your Timeline
Even in some cases in which you find your desired property instantly and make an offer on the first place you visit today, it may still take the duration of 30 to 60 days before you are done with all processes.
Let me know about the category of the timeline that we are looking at:
- QUICK TURNAROUND (usually takes a period of 2 to 3 months): In such case, you have limited options and you to move instantly.
- STANDARD TURNAROUND (usually takes a period of 4 to 6 months): In such scenario, you have some available time to go through the market trends on MLS.
- LONG TURNAROUND (usually takes a period of more than 6 months): In case if you are not hurry about the purchase, you may avail the advantage of buying during low season or you may wait till the arrival of high season in which you may probably have more available items and options on your checklist.
It’s suitable for you to see properties with me in order to build and explore your knowledge base even if you are almost a year away from your purchase. Alternatively, in case if you are two months far from your lease ending, you may still have available time to search for the most suitable place however we will only be required search aggressively. Moreover, another crucial timeline to consider in this regard does not relate to you but it relates to your market as our state has variable low and high seasons. So Email me the same day so that I may send a region-specified guide to you about the seasonal and ongoing market trends of your city. So, that’s all! Four easy and simple steps before you wish to go out there and starts visiting properties. Email me the same day to get the things started!