Ready to Buy?
Your home will almost surely be the most expensive purchase you ever make. It’s a huge deal, and we’re here to help you get a great deal. We’d love for you to work with one of our agents as you search for your first or next home, but here are some things you should do no matter who partners with you on this endeavor.
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How Much House Can You Afford?
A common rule-of-thumb for determining how much home you can afford is to keep your search below three to five times your annual household income. Saving more cash for a down payment and reducing your other debt allow you to afford more home.
Many conventional loans will expect a 20% down payment, but don’t let that scare you away, especially if you’re a first time home buyer. There are a lot of loan programs available now to help you get started on your first home that can help get the initial cost down.
Mortgage payment calculators are great for helping you figure out your budget, but remember that being a homeowner has a lot of costs you may not consider if you’re a renter. Make sure you leave room in the budget for the utilities and maintenance that you may not already be paying.
There are a lot of loan programs available now to help you get started on your first home that can help get the initial cost down.
So you’ve figured out how much you can afford, but now need to find someone loan you the money. A mortgage broker will be able to help you determine how much a bank will be able to loan you based on your credit score, how much savings you have and your income.
To be approved for your loan, you’ll need to make sure you have some documentation like a W-2 statement, pay stubs to prove income and recent bank statements.
Pick A Real Estate Agent
Choosing the right agent is going to make your whole home buying experience better. You’re going to be spending a lot of time working with this person, so it’s important to find an agent who you trust professionally and can work with on a personal level.
Your agent is going to be the match-maker between you and your next home, so you want to find an agent who really ‘gets you’. At Vanguard we know how important it is to have a great relationship with our buyers. Meet our team to see what we can do for you.
Take notes and photos of the houses so you can keep the details straight.
Work with your agent to start viewing homes! This is the most exciting part of the process for most people. You should have an idea about the area and price range you should be looking for. There’s a lot of ways to find homes online (Check out our search page), but your agent will be able to get you more up-to-date information and the latest leads.
Talk to your agent about what you do and don’t like about the properties you look at. Sometimes touring a house you hate will help your agent figure out what’s really important to you so they can find what you’ll really love.
Also, keep an open mind when you view homes. When you’re making note of the things you don’t love about a house, remember that some things can be changed like paint, landscaping and fixtures and some things can’t, like location, lot size and home layout.
Once you find the right home for you, you and your agent can start working on an offer. The seller will review your offer and you will negotiate from there. Once both parties have an offer they agree to, the house goes into escrow while the rest of the purchase is completed.
Home Inspection Time
In most cases, your offer will be contingent on the home passing an inspection. Your agent should be able to recommend an inspector they’ve worked with in the past and trust. The inspection is done within a few days of the accepted offer. It is for your protection to make sure you’re aware of anything that could be an issue with the home.
The inspector will give you and the seller a report that details anything they found during the inspection. You will then have a chance to go back to the negotiating table to see if there’s any repairs that need to be done before the sale closes. You will also have a chance to back out of the offer without penalty if you find something seriously wrong with the property that was undisclosed.
Finalize Your Loan
Your mortgage broker will line you up with a lender and loan tailored to the property you’re purchasing. You’ll have some decisions to make here about loan duration, and you may be able to adjust your down payment or ‘buy’ a better interest rate.
Home Appraisal Time
Your loan will be contingent on an appraisal. This is done by an independent, licensed appraiser who will determine the value of the home. The appraisal will let the banks know that they are safe in lending you the money. If the home appraises for the amount you’re borrowing, then your purchase will move forward.
The appraisal can be one of the more stressful parts of your home buying process. You’ve already decided that this is the house for you, and you’ve already worked out a fair price with the seller. Now you just need the lender to sign off on the deal. Try not to worry too much. Your agent should have a pretty good idea what the home will appraise at and your inspection should have found anything structural that could make the lender uneasy.
You, the lender and the seller should receive a detailed report with the appraised value of the home and any issues that need attention within a few days.
Now you just need the lender to sign off on the deal.
Once the lender is confident the house is worth what you’re borrowing for it, they’ll arrange for a title company to handle the paperwork. You’ll be signing and initialing more than you ever have before. Title companies usually let you keep the pen, so you shouldn’t walk away empty handed.
Close The Sale and Go (to your new) Home
It usually takes a few days to process all the paperwork you signed at the title company. Once everything has been processed, filed and approved, the lender will deliver a check to the seller.Your agent will let you know when the keys to your new home are available. Congratulations, you’re all done! Now for the real fun to start; moving…