January marks the beginning of a new year, and with it comes a perfect time for a fresh start. Some people try out New Year’s resolutions, which are all well and good, but others like you are looking for something a bit more radical. What could be more life-altering than buying a new home in 2017? If you’re looking to make a purchase in the new year, you should consider doing it sooner rather than later. With possible interest rate hikes being forecasted for the coming year, it’s now or never to buy a home and get the best possible deal. Consider what you need to know to make this happen? There might be nothing more confusing and daunting than buying a new house. Fortunately, we are here to help. If you’re not sure about how to get started on this difficult, but rewarding, process, read on for useful tips and advice.
Take Care of Your Money First
The most important thing you need to do, and the item you should check off on your list first, is to be aware of your financial situation. Failing to understand everything about your financial strength ahead of applying for a mortgage is, by far, the biggest mistake people make when buying a home. Mismanaging your money, or not understanding it thoroughly, can prevent you from buying a home. If you are able to get a home initially but don’t maintain your good financial standing, it can make it impossible for you to keep your living situation intact.
Make a Budget and Start Saving
Buying a home is an expensive process. You’re already aware of the monthly payments, but the purchase itself will cost a lot as well. You need money for a down payment, money for closing costs, money for legal fees and who knows what else. All in all, you want to start saving as soon as possible, because the money adds up to a lot before you sign on the dotted line. Figure out where you can trim your budget, start putting all available funds into your savings.
Fix Your Credit
Your FICO score is one of the most important numbers in your life. Yet, if you’re like most people, it probably confuses you to no end. In a nutshell: keep your credit card debt down. Financial experts recommended you only have one or two cards, and keep the balance on those cards below 30 percent of your maximum borrow-able credit. Don’t be late on payments, and don’t open up any new accounts while house-hunting. The higher your FICO score and 740 or above is a good target to shoot for, the more it will benefit you in getting a loan and keeping your interest rates down.
Shop Around for a Lender, and Get Pre-approved
All lenders are not the same. Since you are potentially signing a legal contract that keeps you in debt for the next 30 years or so, it is important that you shop around until you find one that feels right in terms of doing business. Once you do, get pre-approved for your home loan. This pre-approval is important for a few reasons:
- It gives you a maximum dollar figure while house-hunting, so you won’t be tempted (or able) to get more home than you can afford.
- It streamlines your buying process. Once you find a house you want to buy you can go right into the next phase rather than having to wait for a loan.
Once your money situation is in hand and you have been pre-approved, you can begin the fun part: house hunting! As long as you stick to your budget, you can start looking around for the house that best suits your needs. As you begin, make sure to do a few things.
Understand the Current Market
As you start looking, you’re probably going to feel a little overwhelmed at first. In addition to all the housing choices out there, it’s difficult to know what is and what isn’t a good deal. Start doing research as soon as possible. Websites like Zillow are great for getting a virtual tour of what’s available nearby as well as a giving you an insight into what houses are going for in your area. Research gives you an idea of what you can expect to pay. Knowledge helps you later on as you start considering putting an offer down on a house.
Decide What You’re Looking For
Do you want a one-storey house? Two stories? Ranch? Brick? A wrap-around porch? A pool? A large yard? Paved driveway? Three bedrooms? Four? A garage? These are questions you want to try to answer as you start your research. Along the way, you learn to narrow your choices and options based on what’s most important to you. Figure out what is important to you and start narrowing your search. Buying a house is a difficult process already; the last thing you should do is waste time on houses that don’t meet your particular needs.
Find an Agent
As you’re looking around for a house, start shopping for a dedicated real estate agent. Like your lender, you must find someone who you feel can work to meet your needs. If you’re ready to start looking to change your life in 2017, then you owe it to yourself to see what’s out there in beautiful Bandon, OR.
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