If you’ve decided to buy a home, it’s tempting to jump right into your home search. However, rushing into home shopping before you’ve laid the proper groundwork can lead to mistakes, frustrations and expenses down the road. To give yourself a better chance for a smooth, affordable and stress-free home purchase, you need to prepare first. Here are five things to do before you ever set foot in a home for sale.
1. Get mortgage-ready
If you want a great deal on your loan and an easier home purchase and financing process, it pays to get mortgage-ready early. Contact your loan officer so you can have your credit reviewed, evaluate your mortgage options and get preapproved for a loan. This will help you set your homebuying budget, show sellers that you’re a serious buyer and minimize any surprises during later steps in the mortgage process.
2. List your must-haves
Once you start shopping for homes, it can be easy to get overwhelmed by the available choices. And if you’re searching in a fast-moving market, you may not have much time to evaluate each property. Having a prepared list of your must-haves will help you narrow down and prioritize homes, avoid impulse decisions and guard against buyer’s remorse.
3. Review a residential purchase agreement
Don’t wait until it’s time to sign on the dotted line before learning how real estate contracts work. Review a sample residential purchase agreement with your agent so you’ll be up to speed during the more urgent and paperwork-intensive contract stage of your home purchase.
4. Prepare to be flexible
Your homebuying process is likely to take a few unexpected turns. If you’re lucky, you’ll end up with exactly the home you expected. More likely, however, is that you may have to make a few compromises along the way. By being flexible from the start, you can avoid needless frustration and keep your home search on track.
5. Build up your cash reserves
Even with your mortgage covering most or all your home purchase price, it’s still important to have enough cash on hand. Gathering sufficient funds for your down payment and closing costs are essential, but it’s also recommended to have an emergency fund equal to several months of your expected future expenses. Your loan officer will advise you on how much cash to set aside.
For complete, personalized advice on how to prepare for a home purchase, contact your real estate agent for guidance on homebuying, and contact us for help getting mortgage-ready.