Imagine you’re holding the keys to your new home. It’s finally yours. How does it feel? This might be one of the most joyous moments of your life! But before you indulge this alluring fantasy for long, you should first prepare yourself to face the realities of the process of buying a home and create a plan that will bring your dream to life.
This post will help you understand all the steps of the home buying process so you’ll know what to expect.
The first and most crucial step of buying a house is to define your MAP. MAP stands for Maximum Affordable Payment. It is an estimate of the maximum cost that you can bear without severely affecting your financial health and living standards.
Determining your MAP helps you filter your options, mortgage plans, and estimated loan installments in advance. To define your MAP, you will have to evaluate your existing assets and debts with a reliable advisor. Your advisor will guide you in searching for different loan plans and help you find the best available options in terms of rates and repayment. Your advisor will also assist you in establishing a financial goal and review your loan options. All of this work and planning will enable you to budget effectively and prepare for your home buying journey.
The second step is to plan the source and amount of your down payment. Your mortgage plan and principal decide the minimum requirements of your down payment. In some cases, you are entitled to pay as low as 3.5% of the total principal amount as your down payment. It is, however, advised to pay a reasonable amount (depending upon your financial means) to reduce your monthly mortgage payment.
Deciding on the source of your down payment is essential to bring clarity to the process. Be it your savings or a gift from your parents, friends, or family, you need to have a well-structured idea of the source and amount of your down payment.
Once you’re determined your MAP, you have an estimated budget to guide you while looking for your house. Depending on your budget, you can consider your needs in terms of the size of your home, neighborhood, added amenities, overall design, and aesthetics.
You can form a list of your priorities and search for properties that fit your checklist. You might wish to get the best of everything at a price you can afford, but you might have to compromise on some of your desires. This is where the priority list simplifies the process and ensures that you invest in a home that meets not just superficial desires, but fundamental needs. It will also help your housing agent assist you with better options that fit your estimated budget and priorities.
Once you have performed all the steps mentioned above, like estimating your MAP and coming up with a budget, determining the amount and source of your down payments, noting down your priorities, and hiring trusted professionals, it’s time to step foot in the market.
When you make a purchase this big, it is a natural instinct that you wish to save money in every possible scenario. But this instinct must not stop you from hiring trusted industry professionals. You need to set up a team with experts who will guide you at every step of buying your house. It can be beneficial to have an attorney, a residential home inspector, and a realtor agent by your side.
Your first step is hiring a mortgage advisor. Make sure they are not only a mortgage advisor but a mortgage expert. Your mortgage expert will be your guide, finding mortgage options that are right for you and suited to your needs. Once you have found a mortgage that is the right fit, you will need a lawyer and a home inspector to ensure you not only sign a deal before the home disappears from the market, but negotiate terms that are favorable and in your best interest.
A home inspector examines your future home before you enter into a binding contract with the property owner. Alternatively, you may sign a contract beforehand to avoid losing the property in a hot market, but a skilled attorney will negotiate favorable terms that will protect your interests should anything be found amiss during the home inspection. Make sure you or the seller connect with a licensed, trusted inspector to ensure that the examination is authentic and you are safeguarded from any form of fraud.
The inspector will examine the structure of the house, pest situation, radon inspection, pipelines, and other vital components that mark the safety and convenience of the resident. If an issue gets highlighted, you can either ask the seller to rectify it or negotiate on the pretext of the flaw.
Selecting an attorney is a crucial decision. You must hire an established and experienced real estate attorney. Do not settle for inexperienced professionals in an attempt to save money. Remember that when you pay the right amount for an experienced professional, they deliver high-value work and guidance.
Following all these steps will allow you to enjoy the joys of owning a home. Do your due diligence when consulting experts and be strategic! Hopefully, this article helps you structure your process of buying your dream home.
Looking for a mortgage expert who can help you navigate the process of buying a home? Reach out to an Astar loan officer today!
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