Make A Home-Buying Resolution for 2019
Posted on 11.1.2019If you’ve considered becoming a first-time homeowner or building your first home but aren’t sure it’s right for you—or don’t know where to begin—think about making 2019 the year you start on the path to homeownership. The information below can help you make a New Year’s resolution that you’ll want to stick to!
The Basic Steps to Buying a House
While your individual circumstances, financial situation and the type of property you’re buying will all factor into your personal home-buying plan and experience, these are the foundational steps toward owning your own home.
Step 1: Research homes on the market
If you’ve been dreaming of owning a home, you probably already have certain styles and neighborhoods in mind. It’s important to look beyond a home’s curb appeal or the photos on listings, though, so that you can be a smarter home shopper. Go deeper on the information provided on listings to find out how long a home has been on the market and how much the price may have dropped since it was first listed, and research what other similar homes nearby recently sold for. All of this will give you a better idea of whether asking prices are fair or realistic.
Step 2: Find out what you can afford
There are several online calculators that can help you determine a home-buying budget, but only use these for a general idea. To arrive at the most accurate number, take the time to meet with lenders who can guide you through the process to become prequalified or preapproved for a mortgage loan. You won’t need to fill out lengthy loan applications just yet, but you will need to provide enough information about your finances so that the lender can give you the numbers you need to be ready to make an offer when the right home comes along.
Step 3: Work with a real estate professional
Real estate transactions are legal and financial agreements, so it’s a good idea to have experienced professionals helping you navigate the process. As a buyer, you’ll gain the advantage of having someone who’s familiar with the market and the neighborhoods you’re considering, and who may also have early information on just-listed properties that fit your needs. Real estate pros can also help with negotiating, which could save you thousands of dollars.
Step 4: Tour homes
Once you have a short list of existing homes or model homes in communities that interest you, it’s time for an initial kick of the tires. Although it’s easy to quickly fall in love with a home that appears to check off everything on your list, keep a critical eye on the smaller details. You may want to turn on faucets, make sure windows operate properly, check light switches, and look for any signs of cracks in walls or foundations or evidence of prior water leaks. Cosmetic details can be inexpensive to fix, but structural issues can be serious budget-busters. Don’t rush through a tour—remember that this may be the single largest financial transaction you’ll ever make!
If you’re looking at homes in communities with a homeowners’ association (HOA), be sure to find out how much annual HOA dues are and how often they may have been increased over the years. Also take a look at community pools, tennis courts or other amenities that may be in the community to assess how well they’re maintained.
Step 5: Make an offer
This is an exciting time, but be sure to be deliberate in your decision to make an offer and in negotiating counteroffers, and stick to your budget. Your real estate professional should be able to provide expert guidance through this phase of home-buying.
Step 6: Schedule an inspection
A home inspection usually happens soon after your offer is accepted, and it can be a deal-breaker if your purchase is contingent on whether significant repairs are needed or structural problems are found. (Note that some sellers offer their properties “as is,” meaning they don’t intend to make any changes or repairs.) Once you have the report on the inspection, you and the seller (via your respective agents) will negotiate on what repairs must be made in order for you to proceed with the deal.
Step 7: Secure your loan
There are many different types of mortgage loans available and your lender will be able to recommend those that are right for you based on how long you plan to stay in the house, what monthly payment amount you want, and other criteria. The lender’s financial institution will schedule an appraisal of the home, which will confirm that the price you’ve agreed to is in line with the condition of the home and the price and value of comparable homes in the area.
Step 8: Wrap up the paperwork
The number of forms that must be filled out and documents you’ll be asked to provide can seem a bit daunting, but again, you’re making a transaction that has many aspects to it, both legal and financial. Your lender and your real estate professional can answer any questions you have about the various documents, so don’t hesitate to ask about anything you’re not clear on.
Step 9: Closing
This is it! It’s time to finalize the deal and complete your purchase.
Home-Buying FAQs
These are some of the most frequently asked questions that people ask online about buying a home:
Q: What credit score do I need to buy a house?
A: Credit scores are very important factors in qualifying for a mortgage loan, since you will typically qualify for better interest rates when you have a high score. There are many different mortgage loan programs, and each will have particular minimum credit scores, but in general, a score below 600 may not qualify you for a 30-year, fixed-rate loan through a traditional bank, but you may be able to qualify for a Federal Housing Administration (FHA) loan with a 10-percent down payment and a credit score of 500. Check with your lender for a final determination.
Q: Can I buy a house with no money down?
A: There are zero down payment mortgages, but you may have to meet one or more requirements in order to qualify for such a loan. For example: The U.S. Department of Veterans Affairs (VA) has such a program for veterans, but you would still need to have sufficient income and a certain credit score. Ultimately, making sure you’re able to manage closing costs, mortgage payments, home maintenance, and other costs should be considered above all else.
Q: Do I need a real estate agent to buy a new home?
A: The law does not require you to have a real estate agent when you’re buying a house, but real estate transactions are complex. An agent can help you make your way through finding a home that meets your needs, negotiating the price and any repairs, steering you to reputable lenders and much more. According to Bankrate, approximately 10 to 15 percent of home sales are done each year without an agent, but unless you’ve been through several such transactions, a real estate professional can save you time and money, and save you from making expensive mistakes.
Q: How much do I have to put down on a house?
A: There’s no single answer to this question, since it depends upon the particular mortgage loan program you have. There are programs that require three, five, 10 or even 20 percent down, and as described above, zero down payment mortgages. According to the National Association of REALTORS®, the median down payment in 2018 was 13 percent.
Q: What’s the difference between a real estate agent, real estate broker and realtor?
A: Although one of these terms is often substituted for another, these describe three different roles:
A real estate agent has a real estate license, which he or she earned by taking a minimum number of real estate classes and passing a licensing test.
A real estate broker has additional education and has passed a broker’s licensing test.
A REALTOR® is a real estate agent who has membership in the National Association of REALTORS®. As a trademark, the term indicates that the agent adheres to the association’s code of ethics.
Need to know more? SEDA New Homes is here to help.
We can make your home-shopping and home-buying experiences easier. With brand-new homes in communities across the Northeast Florida area, you’ll have plenty of choices—and your choices don’t end there. When you buy from SEDA New Homes, you can personalize your home with a full array of both interior and exterior finishes, materials and fixtures that let you make your new home as unique as you are. We even have closing, packing, and moving checklists that can help you streamline the entire process. We also have move-in-ready homes throughout our communities with a wide range of floor plans and styles.
Browse our communities, then come see our quality construction and exciting designs for yourself. We’re here to do all we can to help you keep that home buying resolution for 2019!