Choosing to purchase a home can be one of the most daunting yet exciting experiences you’ll ever have. Understandably, many people in the housing market don’t really know some of the basics and thus tend to make the same mistakes. However, there’s no need to feel intimidated by it; all you need to know are a few essential information regarding the process. Read on to learn about some of the common obstacles you’ll face and how you can avoid making a mistake when you get to them.
Get a Loan Approval Letter First
If you’ve decided to purchase your first home, that means you’re financially in a good position. Although that may be true, the seller might not know that and thus will not have you as a priority when you place a bid. This is why it is so important to always have a loan approval letter before placing a bid on a home. This letter is essentially a guarantee from your bank that you qualify and are approved for a mortgage. Buyers see this and know that you’re serious, thus placing you at the front of the line.
Conduct Your Own Home Inspection
Many states require the seller to have had a home inspection done before they appraise and put the home on the market. However, you should never take this as the home being perfect and ready to be moved-in. Remember, once you’ve signed on the dotted line, then it means that you’re accepting the home as-is. Always have your own home inspector come in and make a report.
Shoot for More Than 20%
The golden rule in real estate is that you should put down at least 20% for your down payment. Although this number is certainly not bad, you should wait to place yourself in a better position. This means waiting off to purchase a home in order to save up to put down more than 20%. Doing so means that your interest rate will lower significantly, making it easier to pay your monthly mortgage payments.
Bring in a Buyer’s Agent
One of the negatives about solely working with a real estate agent is that they might show you properties that their firm has vacant. A buyer’s agent has no agenda to show you anything that belongs to a firm, and thus it is recommended to work with one.