Essential Steps to Buy a House

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The following is a guest post by William from Home Loan Finder.

Essential Steps to Buy a House

When it comes to buying a home, there are many things to consider. Not only do you have to have a lot of money for a down payment, but you should also be fully aware of the level of commitment you are about to enter into. A house is a major investment. Below are 5 things to keep in mind as you are embarking on this step in life.

1. The price is always negotiable

When you are ready to buy, home sellers are ready and waiting to sell to you. And, since you do not know the situation of the seller, you never know if they are anxious to sell or not. If they are, this can be to your advantage. If the house is more than you can afford, but you feel the seller might be willing to budge on the sale price, ask them to come down a bit. It does not hurt to ask and you may be surprised to discover that many sellers expect it.

2. Buy what you can afford

You may want that gorgeous house on the beach with all the windows and space, but you probably can’t afford it. Look at your finances and your prospects for the future and judge accordingly. When you buy homes, it is always easy to have our eyes be bigger than our wallet. If you get into something that will be detrimental to your financial life in the future, you will regret it. Be responsible, be thoughtful and make the best choice according to what you can reasonably pay.

3. Have a down payment

Gone are the days of financing for anyone and their dog. You must have a down payment now when you approach a bank and it should be at least 15% of the value of the loan you would like to borrow. The more you have saved the more a bank is willing to negotiate with you and give you the best interest rate and the best product. You will be in the drivers seat if you have done the hard work and saved the money.

4. Keep your credit clean

If you have bad credit, it will be difficult for you to qualify for a loan. It is important that you pay your bills on time and pay your outstanding balances off. A lot of credit card debt and other liabilities may stand in the way of you getting the loan that you need for your home.

5. Make an offer that is in line with other homes in the area

Many home sellers are expecting that you will want to negotiate the selling price. So, when you are ready to put a bid in on a house, be sure that it is in line with other similar homes that are in the same area. Look at the sales of homes similar to the one you want and find out what they were sold for. This will put you in a good position when you go to the bargaining table.

If you look at all of these points, then you will be ahead of the game when you are ready to search for and buy your new home. It can be an exciting process and hassle-free if you do your homework and make the right decisions.

How about you all? Have you been through the home purchase process recently? What steps did you take to make sure it all went smoothly? 


Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

• @ The requirement to have a big down payment in order to buy a home – This is not necessarily true. You can get FHA home loans with very little money down. However, you must be ready to pay for Private Mortgage Insurance (PMI) each month if your down payment is less than 20% of the home value.
• @ The price being negotiable – This is certainly true. Personally, I was able to negotiate the price of my condo down from $109,000 to $105,000. I’ve heard that as a general rule of thumb, you should at least offer 5-10% below asking price.
• This is one of the important reasons to have a good real estate agent to help you. They will be able to advise you on the proper value of property in the area you’re investigating.
• @ Buying what you can afford – This is certainly true as well. Typically, you can qualify for much more home than you can actually afford. Generally, you should target paying no more than 30% of your monthly income to mortgage payments. 

***Photo courtesy of http://www.redwoodbridges.com/images-spa-steps/spa-steps2.jpg