The very first place you can call your own, somewhere you can plant your feet and stay for years to come. Deciding to have your very own home and making the switch from renting is a very exciting new endeavor. However, many newcomers and rookies tend to find it hard to navigate around buying their first home.
Fret not, in this guide we will show you how you can buy your first home in just 12 months! Yes, this checklist will help you avoid potholes and common mistakes rookie buyers tend to make. So let's get started.
1 month in
Check your credit score Yes you need to check the numbers first so you can find out what houses you can afford and get realistic on the homes you can buy. Determining your credit score will not only help you figure out how much you can buy or how much you want to buy, this will also allow you to get a picture of how you can increase your credit score so you can buy the ideal house.
There are many online calculators to help you in this and if you want to increase, dry reducing your debt-income ratio so you can increase your credit score and hopefully get the ideal house you've been looking for.
Down payment plan. Most mortgages will require you to make a 3.5% down payment on the home you would like to buy. You can even make bigger down payments which are more than 3.5% to lower your monthly payments and give you better interest rates. However, if you can't afford to pay the 3.5% required amount, you can always go to different programs to help you.
Oh, and by the way, another thing the banks would like you to "season" your money, which means they would like to see stable funds in your account for 60-90 days before applying for a loan. So there you have it, now on to the next.
3 months in
Visualizing the house you want, Now try to identify the house you are looking to own, what does it need to have? a big yard? does it need to have a garage? how many rooms? and if it's a joint decision, this may be a good time to ask the spouse, so you can already determine together the house you wanna buy and make compromises on the home you would like to have. This will save you a lot of time and hopefully avoid fights when you start to look for the house.
Hunting for homes. Now, this is where the fun begins. To start you can research online to find out neighborhoods, public transport and cost of living expenses along with other details you should know about before you buy a house. You can also search homes through our site , Austin Luxury Realty where you can look for homes and other properties along with your minimum and maximum price range. You could also go to open houses and see it first hand, the houses you could buy and have a face to face conversation with the sellers to get more details on the property you are looking for. This would also potentially encourage you to reduce your debts and save for your down payment especially if you that the best houses are also the some of the most expensive.
A budget for miscellaneous expenses. buying a new home has a few upfront costs as well, things like home inspection, home insurance, and other payments that need to be done. It's not that much, but be sure to already have a few extra hundred dollars to bet the payments in.
Home Savings. One good habit to get into is to save a bit of money for the house maintenance and other emergencies like plumbing, repairs and other things that need to be paid just in case.
6 months in
Collect your paperwork. Banks are very particular when it comes to loans, even more so in mortgage loans. They would require you to have a lot of paperwork. Paper works like, business tax forms if you're self-employed for the past 2 to 3 years, personal tax returns, most recent pay stubs, credit card and all loan statements, bank statements... etc. So it's best to have these things ready and in order so when the time comes, your set and ready to go. Another good thing about this is it will also help you save up and understand how your expenses are going so you can get enough money to pay for the down payment and calculate your expenses when you pay your monthly dues.
Research lending and realtors.
you can also start looking for realtors; Austin Luxury Realty
Is here to help you find the right property. We will also help in closing the deal and could hook you up with finding a lender that could assist you.
is one of those realtors that could help you find the ideal home. We offer the best information on apartment rentals, condos, homes for sale.
9 Months in
Get pre approved. Once you've reached this point in the timeline, your paperworks credit score and downpayment should already be on track, if not I suggest you re assess it or ask a bit of help. But if all is going well, you start to get to work. First you need to get approved on your loan.
Call up your lender or broker, make an appointment and bring the necessary paperworks. They'll run a credit check on you and tell you how much of a loan you can get approved for. A Piece of advice, it's better to borrow less than the maximum the lender will allow you so you can live comfortably, or if you want to up the ante, you can go to the maximum and work your way through paying the monthly dues.
Shopping for your new home. Once you're pre-approved, the buyer's agents or your chosen agents will be able to find you a home that will meet your priorities and price range. This way, you won't be wasting a lot of time finding and browsing through homes that are not the right fit.
10 months in
Make an offer. You will need a fair amount of time before you get to close the deal on your new home, probably 4-6 weeks. So if you are keen on moving out or have a schedule on moving, it's best to allow enough time to deal with any problems that could delay closing.
Home inspection. One of the things you'll want to do is to find a home inspector to assess the house, he'll tell you if there are any repairs needed or any problems that the property has. This is one of the reasons that could delay you from closing the deal.
Triple checking your documents. You're in the last lap, if you've kept your documents up to date, your down payment ready, then the last few strides will be a lot easier. Reviewing the mortgage documents will probably be one of the most difficult, that's why having an agent would come in handy. We have agents that can help you through this process. Our agents will be helpful in your journey to buying your first home as they assists you in your needs, the things you need to consider to the help you understand and guide you through this endeavor.
Get home insurance. Of course, essentially this is very important as well. So before closing you will need proof of insurance.
Final Walk through. Now it's time to do a final walkthrough of your new home. Ideally you'll want to do this a day or two before closing. Make sure that your new house is in shape and get a feel of your amazing new home.
Secure the money. Now you have to secure you get a cashier's check or bank check with the exact amount of cash you will need for closing. Most likely, you'll get this number a few days before the closing date. So secure cashier's check or arrange to have the money wired and have your final affairs in order.
Congratulations! that's all for our 12 month buying guide to your new home.