Five Steps to Purchasing Your First Home
There are many reasons why the real estate market may be somewhat appealing to some right now. For the first time since the recession, there has been steady and consistent growth that has investors cautiously optimistic about getting back into the market. With additional government tax incentives for first-time buyers and a significant portion of the population considering purchasing a home to be a wise investment, quite a few will be looking to take advantage of near-record-low interest rates.
However, before any investor dives into the waters, whether experienced or not, it is important to research and consider a few key steps in order to successfully purchase a property.
Here are five steps that buyers should follow, according to USA Today.
- Prepare Finances - Before applying for property, it is obviously important for investors to know their budget. However, financial preparation goes much further than just budgetary concerns. It is advisable to research credit scores among the different rating systems to find out the likelihood of approval. If a score is too low, consider looking into a co-signer to help secure the sale.
- Research a real estate agent- The best way to find housing is through friends and family recommendations. Based on the best suggestions, go to various real estate websites and research agents and brokers that will best suit your needs for your dream property. Make a pros and cons list and prioritize your demands. This can help save time for both parties involved and help make the process much more streamlined.
- Research the property - Like any important decision, research is key. Educate yourself about the reputation of the builders, property managers and the local homeowner association. Get to know possible neighbors and the neighborhood itself including the school system, public transit and any areas of importance.
- Make an offer - In today's market, the buyer is in control. Examine your finances again and place a reasonable offer, leaving room for negotiation. Also, when applying for a mortgage, be sure to have roughly 15 percent for a down payment. This lets all parties know you are committed to doing business.
- Prepare to close - Closing does not mean simply covering all associated costs. Buyers should be prepared to tie up loose ends and make any necessary purchases in order to protect the safety and security of their new investment, including a title insurance policy. Title insurance offers buyers protection against a variety of circumstances that could potentially jeopardize the transaction, including any undiscovered liens or levies on the property, or unpaid taxes from previous owners.