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5 Tips for Buying a Home
Looking to buy a home? Here are five essential tips for making the process as smooth as possible.
Get your finances in order.
Start by getting a full picture of your credit. Obtain copies of your credit report. Make sure the facts are correct, and fix any problems you find. Next, find a suitable lender and get pre-approved for a loan (this is different than pre-qualified). This will put you in a much better position to make a serious offer when you find the right house.
Hire a professional.
While the Internet gives buyers unprecedented access to home listings and resources, many aspects of the buying process require a level of expertise you can’t pick up from surfing the web. That’s why you’re better off using a professional licensed agent than going it alone. If possible, find a real estate agent given the Realtor designation, as Realtors are held to a code of ethics and standard that regular real estate agents may not.
Find a house you can afford.
As with engagement rings, there’s a general rule of thumb when it comes to buying a home: two-and-a-half times your annual salary. There are also a number of tools and calculators online that can help you understand how your income, debt, and expenses affect what you can afford. Don’t forget, too, that there are lots of considerations beyond the sticker price, including property taxes, energy costs, insurance, etc. Your Realtor should be able to assist you with this information.
Do your homework.
Before making a bid, do some research to determine the state of the market at large. Is it more favorable for sellers or buyers? Next, look at sales trends of similar homes in the area or neighborhood. Look at prices for the last few months. Come up with an asking price that’s competitive, but also realistic. Otherwise, you may end up ticking off your seller. If you aren't the research type, this is the perfect reason to hire a Realtor.
Think long term.
Obviously, you shouldn’t buy unless you’re sure you’ll be staying put for at least a few years. Beyond that, you should buy in a neighborhood with good schools. Whether you have children or not, this will have an impact on your new home’s resale value down the line. When it comes to the house itself, you should hire your own home inspector, who can point out potential problems that could require costly repairs in the future.