Buying a house can be an overwhelming but also an important milestone. For first-time home buyers, most of the time, you do not know what to expect as the process is both intimidating and exciting. One of the first thing you have to think about after buying a house is the renovation which you can engage Beautiful Homes for as they are one of the top interior design company in Singapore. This article will walk you through these ten key steps involved in the house buying process.
i. Start researching early
Get information from websites, magazines, and newspapers with real estate listings. Make notes of some of the houses you are interested in and see how long they stay in the market. You can also look at the housing trends in particular areas.
ii. Determine how much you can afford
Before reaching out to a mortgage lender, you must determine how much house you can afford. Generally, experts recommend that you go for a house that will not cost you more than 30% of your gross monthly income. You can make use of the Home Affordability Calculator to do the calculations. Also, consider the kind of lifestyle you want to live to cater for emergencies; consider vacations, retirement, and college funds as you plan.
iii. Get preapproved and prequalified for your mortgage’s credit
Provide financial information to a mortgage banker, including investment and savings, to prequalify you for a mortgage. The lender will review the information and let you know how much you can get as a loan. With this information, you will see the price range of houses to look for. Later, you will then be pre-approved for credit which the lender will verify.
iv. Find the right real estate agent
Real estate can help in the process of buying a home. These individuals provide essential information on houses and the neighborhoods that is not accessible to the rest of the public. They possess negotiation skills and are experienced in the process. Most importantly, you don’t have to spend a coin to use these agents as they are paid from the commission paid by the house seller.
v. Go shopping for the house and make an offer
Since you now know the price range, start touring homes and make notes on every home you visit. Since you might come across many houses, keeping pictures or videos can help you remember each of them. Take your time to look for the right home, work with the real estate agent to negotiate a reasonable price. When you have identified and settled for one house, the house will then go into escrow.
vi. Do a house inspection
This step ensures that the house is checked for structural damages. The agent will help arrange the inspection within a short period of the seller accepting the offer. An inspection report will be given to the seller and the buyer. As the buyer, you will then decide whether to have the seller fix the property before closing the sale.
vii. Reach out to the mortgage banker to select your loan
Lenders offer different-priced credit programs. Since you will be buying a house and new in the process, having a mortgage banker who is experienced and responsive can make this process easier.
viii. Appraise the home
Lenders will help arrange for an appraiser to provide an independent estimate of the value of the house you are buying. This process comes before any funds are released. The lender will provide funds to cover the appraised value of the house. However, when it comes below the purchasing price, you can negotiate the price or come up with the difference.
ix. Purchase homeowner insurance
Homeowner insurance serves as a safety net to protect the house and finances. This is one of the requirements lenders want before giving you a loan. This covers damages in the house and the surroundings.
x. Facilitate the paperwork and close the sale
The lender will arrange for a title company to handle all the formalities and ensure that the seller owns the home you are purchasing. Also, a final walkthrough can help recheck the property before buying. Closing the sale involves you signing the paperwork, including the loan documents. Once the lender receives the papers, it will take some days for them to be processed. Immediately the seller receives the cheque, you will be ready to move into the house.
Infographic Provided by Marketplace Homes
