Are you ready to buy a home? We walk you through what you need to get the search started.
Find out how much home you can afford
A maximum of 28% of your income is recommend to be spent on your mortgage payment. This changes from person to person depending on what other debts you may have. Use a mortgage calculator to decide how much house you can afford. Remember, if you choose to go the condo route, you’re going to have HOA fees to pay as well.
Get your finances in order
Have enough money saved for at least 3% of your targeted house price for the down payment, 1.5% for PMI, 1.5% for closing costs. In total we recommend you have about 6% saved for initial purchase costs. We also recommend having additional savings in case initial repairs are needed. Also, make sure you’re credit is favorable.
Decide if it's the right time
Sometimes buying a home doesn’t always make sense. If you can only afford a 2 bedroom but absolutely need a 3 bedroom, maybe wait until you have more savings for a larger down payment so you can buy a home that fits you. Buying a home is a 5-to-7-year investment. This is the time frame you will gain enough equity to be able to sell for a profit. Make sure you are okay with putting down some roots.
Get a pre-approval letter
You’re going to need last 2 years W2s. If you own a business, you also need 2 years of tax information for your business. Gather any other proof of income you have to support all income generated.
Find an agent
Ask your friends for recommendations on a good agent. Talk to a few, decide on one that has experience and fits your personality. This is one of the largest transactions you will ever have. Make sure you feel good about the person walking you through it.
Make a wish list for your agent
It’s not only how many bedrooms, but also other quality of life preferences. Do you need a garage? Would you like your home to be walking distance to restaurants? Do you want to be able to rent out a portion of the home? Rank these preferences from most important to last. Give this information to your agent.
Your agent will let you know if you need anything else before you start looking. Sit down with them and develop a strategy for winning bids. Remember to have fun with this part. Putting in offers on houses could be a stressful time, try to enjoy going around touring houses.
If you have any questions or are looking for someone to guide you through the process, feel free to reach out to us. We are always available!