Buying a home is an important decision that can fill your life with excitement and a bit of stress. While the process is worth it all, you may find yourself feeling unsure if you don’t have the right information. Check out these six steps to buying a home to arm yourself with the basics before you begin.
💯 What Credit Score is Needed to Buy a House?
Just like with any large purchase, it’s important that you know your credit score. Knowing your score will help you better understand what to expect when buying a home. Lenders are going to assess your credit situation when determining whether or not they will approve you for financing.
However, there is no universal minimum credit score that you need to buy a house. The credit score lenders are going to require depends on the economy as well as what type of loan you need. In general, you can expect to need a credit score of at least 620 for a conventional loan. There are other factors, of course, that a lender will take into consideration, such as your income, debts, and down payment, but those are going to apply on a case-by-case basis.
💰 How Much Do I Need to Save to Buy a House?
One of the most common concerns people have when buying a new house is whether they have the 1.5% of the purchase price to cover closing costs. The amount of money you have saved is going to be an important factor when applying for a home loan. There are strategies for both long-term and short-term savings.
If you are hoping to buy a home in the next two to three years, a great place to start would be to save 10% of your pretax income. Depending on your housing market and your yearly income, this should put you in a great position to enter the housing market in a few years.
If your goals are more short-term, consider increasing your savings from 10% to 20% of your yearly pretax income. This amount should allow you to begin house hunting in the next 12 months.
💻 How Do I Find a Real Estate Agent to Buy a House?
Finding a great real estate agent is vital to having a seamless house hunting experience. It is important to find an agent who will listen to your concerns and desires as they relate to the purchasing of your next home.
Lesley Wagstaff tells her clients that it’s important to choose a real estate agent that they like and trust. It’s also important to enjoy being in their company. Because this is the most important financial commitment you’ll make, it’s best to have someone in your corner who understands your needs and works with your best interest in mind. Lesley is dedicated to providing you with answers to your questions and all the information you need to increase your confidence in the home buying process.
📝 How to Make an Offer on a House
Once you have found your ideal home, it is time to make an offer. This step is where the house buying process begins to pick up and become a little more complicated. Just follow these instructions, and you should not have any problems placing an offer on your chosen home.
The process includes the following steps:
- Make a written offer
- The seller will accept, decline, or provide a counteroffer
- If you are given a counteroffer, you can accept or decline
- If you cannot come to an agreement, you can make a new offer, or begin looking for a new house
To make a written offer, you need to do a little more than write a letter. Written offers are legally binding. Talk to your real estate agent. Your agent can provide you with an agreement that will abide by the law. You can also attach a personal letter to the official offer, but it will not in any way be legally binding.
🤝 What Happens After an Offer is Accepted?
After an offer is accepted, and both parties have signed the offer agreement, then everything the has been contractually agreed upon begins to unfold.
You will need to be approved for a mortgage. You should begin looking for financing immediately as it can be time-consuming, and the time spent wondering about the unknown can cause stress.
Other things that need to be addressed are the purchase of homeowner’s insurance, the completion of a final walk-through, and a discussion with your lawyer about the title report.
📅 What Happens on the Closing Date?
Closing day is when you’ll pay any fees owed and take possession of the property. While it’s often referred to as closing day, the actual closing process may take place over a couple of days. There are some instances where moving into the property are delayed due to the owner needing to move, but these will be decided beforehand and noted in the contract. On closing day, all paperwork is signed. Your real estate agent and lawyer will be there every step of the way.
By following these steps, you can enter the housing market fully prepared to engage in the processing of purchasing your next home.
Your real estate agent is the best source of information about the local community and real estate topics. Give Lesley Wagstaff a call today at 604-313-3358 to learn more about local areas, discuss selling a house, or tour available homes for sale.