So you have made the decision to buy a home. Now what? Where do you start?
There are five things you absolutely must do before you even shop for homes. The home buying process doesn’t have to be a negative experience. There will be a certain amount of stress because it is a large undertaking but it doesn’t have to be a chaotic event if you follow some guidelines.
The first thing you need to do is find out how much home you can afford. Not how much you can get approved for, but how much you can actually afford to live with. This is where most people make a costly mistake. It is easier to find out what your budget can accept without putting you in a bind and set your limit there. What if you over estimate how much you can afford, or if you push it to the very limit of what you can afford you expose your self to risk? What if you lose a source of income or have unexpected expenses. You could risk losing your home. So make out a budget and stick with it.
Next find a good reputable Real Estate Agent. When you are the buyer in the transaction it doesn’t cost you a thing to work with a good agent and it will be the best choice you will make. The Realtor is the one who will make sure that all the legal and contract aspects are correct and will be able to give unbiased advice that will save you money and headaches in the long run.
Once you have a Realtor on your side it is time to know what rights you as a buyer are entitled to. Ask your agent to provide you with this information. In Texas you are required to receive this and other information so it shouldn’t be a problem. Here is a link to HUD http://www.hud.gov/buyers so you can download the information directly. Understanding your rights as a home buyer is very important. Know them and use them to your advantage.
Now you are almost set to start looking for homes. Only two things left to do. Get a 3 bureau credit report. Knowing your credit score isn’t enough. If you actually see the reports you may have things on there that don’t need to be. Having them removed and getting your credit score up will only help you get a better deal on a loan.
And the final step before you go out looking at homes is to shop for a loan. Don’t just talk to one company. You shop for a loan just like you would for any other good or service. You may find that one company may have a little better interest rate. Even a half a point is worth a large sum of money over the life of the loan. Once you have picked a company get a pre approval and start looking for your new home.