Buying a new home is exciting, but it can also be complicated. Minimize your stress by heeding this list of essential dos and don’ts.
Things to do
- DO get preapproved
Submit a preliminary loan application to have a clearer idea of your spending power. Getting preapproved lets you know early on the maximum amount you can borrow. As important, home sellers today expect you to show proof that you can secure the financing needed to purchase their property.
- DO research the neighborhood
Look up the neighborhood of the home you’re eyeing on sites like Niche.com and NeighborhoodScout.com. Then, visit the place and chat up some of the community members to learn more about the local lifestyle. Consulting with a real estate professional who knows the area well also helps.
- DO keep your documents organized and handy
Build a “green file” which contains pertinent financial documents such as bank accounts, credit card bills, tax returns, copies of leases, and investment policy statements. Keep it safe and handy, so you can present them anytime they’re required.
- DO invest in a professional inspection
Hiring a trained inspector allows you to find and resolve any hidden or potential issues with the property – whether it’s a new construction or a previously owned home. You get peace of mind, knowing you’re moving into a home that’s structurally safe and sound.
- DO explore your options
Make sure to shop around the neighborhood that you’re eyeing. Look for at least three options before making an offer. Personally, visit each option to see if each property’s distinctive features justify their respective asking prices.
Things to not do
- DON’T trust everything you see on ads and listings
Remember that ads and online listings are intended to sell properties for their best features, so keep a watchful eye out for possible issues like specifications and repair needs that are omitted from these postings. This is where careful attention during viewings, investing in proper inspections, and close consultations with your agent come in handy.
- DON’T assume that the priciest home is the best
Even if you can afford a more expensive home, think twice before going for it. Ask yourself: does it fit my family’s needs? Am I willing to invest in its maintenance? Is it located in a neighborhood I like? And, is it going to be easy to resell the property that will net you accept returns?
- DON’T make big purchases
You should also refrain from buying big-ticket items like cars and luxury goods once you decide to buy a home. Doing so could affect your mortgage rates and terms and, ultimately, your financial obligations down the road.
- DON’T overlook closing fees and other charges
On top of your mortgage, plan for additional charges that closing your deal will entail, such as inspection, attorney review, and closing fees. You should also factor in recurring expenses like utilities, maintenance, insurance, property taxes, and homeowner association dues.
- DON’T do it alone
Buying a home – especially in a new or unfamiliar location – can be daunting. Find a real estate professional who can provide relevant insights about the community and local market, represent you confidently during the negotiation stages, and connect you to reliable local partners like financing agencies, inspectors, and attorneys. They can all help you close the deal.