9 Steps To Home Ownership
1. Determine If It’s the Right Time to Buy
Although you may wish to own a home, you have to determine if it really is the right time for you to buy a home. Despite popular belief, you don’t have to have a perfect credit score, but your credit score will partially determine the terms and interest rate you will be offered by a lender. You also need to make sure you have enough money for a down payment, inspections, and closing costs. Different loans have different amounts of required down payments, so it may not be as much as you think. If you don’t have any idea of how much those costs may be, you need to talk with your Realtor and Mortgage Lender who should be able to give you an estimate.
2. Find the Right Realtor
Finding the right Realtor is essential to making the home buying process as smooth as possible. You need to find a Realtor who you trust to help you navigate the home buying process. A good Realtor will educate you about the market, help you find homes that meet your wants and needs list, negotiate on your behalf, coordinate your inspections, keep you informed, and help you with any problems that come up. It is essential that you find the right agent.
3. Find the Right Lender
There are many mortgage lenders to choose from. Remember that you will be working closely with this person, and that he or she will have access to all of your confidential financial information. You definitely want to choose someone you communicate well with. You also need a lender who responds quickly to your phone calls, is available to answer your questions, is good at explaining the loan process to you, and has competitive rates and fees. Once you find the lender you want to work with, work on getting a pre-approval letter so you know the budget for your new home.
4. Find the Right Home
Although the thought of finding a new home is exciting, the work starts prior to actually going to look at possible new homes. You need to make a list of all of your wants and needs for your new home, and be sure to include any deal breakers. You also need to determine the area where you want to live, and the budget that you’re comfortable with. Once you have a clear idea of what you want, you have to convey that to your Realtor so you can be set up for an automatic search using the criteria that you decide upon.
5. Make an Offer
Once you find your perfect home, work with your Realtor to write an offer. Go over a comparative market analysis (CMA) with your agent, and discuss closing costs assistance, home warranties, and other contingencies. Make sure that you have a Pre-Approval letter to present with your offer.
6. Complete Inspections
In the state of Louisiana, unless you buy a newly constructed home, you waive all warranties on the home at the Act of Sale. Therefore, you have an inspection period to bring in whatever home inspectors you wish. Most buyers hire a home inspector, a pipe inspector, and a termite inspector. However, those are not the only inspectors that you are allowed. You are permitted to bring in any inspector during the inspection period, provided you have a confirmed appointment for the inspections. During the inspection period you also want to confirm the flood zone, insurances, survey, etc.
7. Move Towards Closing
The final stage of the home buying process is the lender’s confirmation of the home’s worth and legal status, and your continued credit-worthiness. Do not make any large purchases or take out any loans until your house closes. This will change your credit-worthiness and you may no longer qualify for the house. The lender will conduct an appraisal, title search, and a final check of your credit and finances. Your lender will keep you posted on how each is progressing, but it is imperative that you quickly provide all of the paperwork that your lender asks you for so that you can close on time. You will do a final walkthrough within 5 days of closing, and you will receive a Closing Disclosure that you will go over with your agent that is an accounting of all of the money in the transaction. Be sure to turn on all utilities in your new home as of the day of the Act of Sale. Finally, make sure to bring your identification and certified funds to closing.
8. Protect your Home
Now that you’ve purchased your perfect home, be sure to maintain it. Make sure you keep all insurances up to date. Strongly consider a termite contract. Keep your home clean and do not defer maintenance. What may be a small inconvenience today can quickly turn into a huge problem if ignored. Work on saving money for when repairs are needed.
9. Enjoy your Home
Now relax and enjoy your new home. You deserve It!