Buying a home is one of the most expensive purchases you will make in your life, which means the process shouldn’t be taken lightly. If you’re planning to settle down, start a family, and live in the same place for a long time, you need to make sure you take the proper steps before buying a new home. Below, we’ll go over the process you should consider before signing the deed and placing down a welcome mat.

1. Create a Budget

First and foremost, you’re going to need money in order to buy a house. Of course, it’s not expected you have hundreds of thousands of dollars in your bank account to buy a home upfront. Instead, you’ll most likely have to take out a loan to pay off your home over time. This means you need to create a budget and understand your financial history.

Start by getting a free copy of your credit report. You will need your credit report to determine if there are any red flags that may make it difficult for you to secure a loan, or if there are any errors you need to resolve to boost your credit report.

Once you have your credit report, take time to sit down and create a budget and think about how much money you can afford to pay a month for a mortgage. To create a budget, tally up all of your expenses from the past six months to a year, including:

● Food expenses

● Utility and household bills

● Any debt payments (student loans, auto loans, etc.)

● Gas

● Entertainment

Once you determine how much you spend per month, compare that number to your annual salary and other forms of income. Do you have enough money to pay for a mortgage? If so, how much? This will help you determine what your price range is when it comes to buying a house.

2. Get Approved for a Loan

Once you have your budget planned out, it’s time to talk to a private real estate lender. It’s important you speak to a real estate lender before you find a real estate agent because they will inform you about the maximum amount of money you can borrow for your home. With this number in mind, you’ll be able to go to your real estate agent and let them know your price range.

Additionally, you’ll need a pre-approved letter showing you can afford a home before a seller considers your offer. Talking to a real estate lender at the beginning of your home-buying process will make the rest of your search much easier.

3. Find a Real Estate Agent

Once you have a ballpark for how much you can afford to pay per month for a home, including how much money you can put down for a deposit, it’s time to look for a real estate agent. A real estate agent is your ultimate confidante, the one who will be with you from start to finish as you search for homes and eventually close. This means you need a real estate agent who will work with you every step of the way. To find the perfect real estate agent.

● Ask for referrals from friends, family, and coworkers

● Look at online reviews

● Interview potential real estate agents

● Ask for references

4. Research Homes

Once you have an approved loan and decided on a real estate agent, it’s time to begin researching homes. This is the fun part where you get to tour a variety of different houses and choose which one suits your lifestyle best. Some things to look for in a new home include:

● Size

● Number of bedrooms

● The neighborhood

● Storage space

● Kitchen amenities

● Materials used

● System installations, such as heating, venting, and air conditioning

When looking for a new home for your family or for yourself, it’s important you take the time to find a house that works for you. You don’t want to jump the gun on buying a home, only to realize later you made the wrong decision.

5. Make a Decision

Now that you’ve toured numerous homes, it’s time to make the big decision. When you decide on what house you’d like to purchase, work with your real estate agent to craft and offer letter. Here, you’ll be able to negotiate for a lower price and convince the seller to make a more attractive offer. After all, every penny counts when it comes to making a large purchase like this.

Then, if your offer is accepted, invest in homeowners insurance, work with utility companies to let them know your move-in date, and close on the home! After that, you’ll be able to move in and make any home improvements to match your style.

Wrapping Up

As you now know, buying a home can be a long process. You can’t wake up one day and decide to place a down payment and move into a new living space. Instead, you’ll have to get a pre-approved loan, find a real estate agent, do your research, and make an offer.

5 Steps To Take Before Buying A New Home