Buying a home is often the largest single purchase a person will make. The process has many pieces, but by doing some homework and keeping meticulous records, you can be prepared and help to pave the way for an easier purchase process. Here are some basic tasks to consider:
- Decide how to organize and store the information you gather and documents you need, whether it be electronically or going old school with a notebook and 3-ring binder. Keep notes of every conversation with dates and the person with whom you spoke as well as copies of relevant emails and any other documents, brochures, floor plans, or other paperwork. You can start with broad categories such as “mortgage,” “shopping,” and “closing,” and add subcategories as they pop up.
- Figure out your price range and what monthly payment fits into your budget.
- Shop for financing. Ask a potential mortgage company about the following:
- Timelines for pre-approval, appraisal and closing
- Documentation required for application
- Types of products available with interest rates and annual percentage rates
- How much of a down payment is required
- How much closing costs will be and if those are rolled into the mortgage or paid up front at closing (get these figures in writing and file them away)
- What company will be servicing the loan
- References from customers
- Get clear on what you want in a home—your preferred layout and size, your must-haves, features you would like to have inside and out, the type of neighborhood you want to live in, if you want a homeowners’ association, and how close you want to be from schools and other amenities.
- Interview real estate agents. Find out their background in the field, house search philosophy, knowledge of particular areas, whether they work full-time or part-time, how many clients they work with at one time, and if they work primarily with buyers or sellers. In addition, ask about commission, any additional costs to you, and how the contract cancellation policy works. Most of all, make sure you are working with someone you trust to look out for your best interests.
· Keep careful notes as you look at various properties—what you liked, what you didn’t, and any potential items that require further investigation.
- Before closing, take care of the following
- Find out in writing what closing costs you will need to pay at closing, such as title insurance, attorney fees, appraisals, taxes, etc.
- Ask what documents and identification you will need to bring to the closing.
- Obtain homeowners insurance.
Being organized will set you up for success and send the message to industry professionals and sellers that you are an informed buyer.