Finding the right home for you is not just finding your dream home. We’d all love the house with all the bells and whistles. But the truth is, the right home is a combination of what we want, what we need, what we can maintain, and what we can afford. Here are 7 steps to finding the home that is the perfect blend.
1. Get pre-qualified.
Knowing your credit score and how much you have in the bank is different from getting pre-qualified. The best way to get pre-qualified is to talk with a chosen lender personally. Your lender will be able to determine what price range you can afford based on a variety of criteria.
2. Establish your monthly payment.
Just because you qualify for a certain amount doesn’t mean that you want to pay the corresponding monthly payment. Decide the amount you want to spend each month.
3. Find a realtor.
Finding a good realtor is critical to keeping you within your established monthly payment. Your mortgage payment is only part of your monthly payment. The other part is made up of taxes and insurance. A good realtor will be able to approximate your monthly payment as you start your search. A good realtor will also be able critical to step 4.
4. Determine your needs vs. your wants
A good realtor will help you drill down to establish what is truly important to you. During a buyer’s consultation, your realtor will guide you in determining what amenities are in your price range and give you a realistic picture of how your lifestyle, your means, and your future home will fit together. Are schools important to you? Do you prefer urban living? Do you want an established community with historic charm or new construction?
5. Keep saving toward your down-payment and closing costs.
Nine times out of ten, we end up paying more than we initially expected. Whether we are buying clothes, food, a car, or a home, there are always unexpected expenses. Things like interest rates, the appraisal, title insurance, inspection, and other closing costs might increase slightly from the time you start looking to the time you actually close. In a seller’s market, you might have to offer above the asking price to get the home you want.
6. Leave your emotions behind.
This is hands-down the hardest step. What do you do when you have walked into a home that you love? You’re trying to buy at the best price, they’re trying to sell at the best price. Be ready to walk away if you have to. Remember this: Will you love that home as much when the mortgage payments keep you from enjoying something else in your life?