The home buying process comes with a lot of complex details and big decisions. With my experience as a real estate and mortgage professional, I wanted to talk to you today about the three major things to consider during the home buying process. These are the things you want to do and not do.
Do Obtain a Pre-Approval
The first and most important thing for you to do is to get pre-approved for a mortgage. I know a lot of people want to avoid this step because they don’t want to incur that ding on their credit. But, if you do all those lending inquiries within a short period of time, it will be treated as one inquiry and it will have very little impact on your credit.
Based on your debt to income ratio and your credit history, your lender will let you know how much you can borrow, but not how much you can afford. These are very different numbers much of the time. My recommendation is that you don’t ever shop for a house for the maximum amount that you were approved for. You don’t want to be married to your mortgage. You want to leave some room for traveling, other expenses, and maybe even a new hobby. Don’t focus on the approval amount. Do your own budgeting and decide how much you can actually afford to spend.
Do the Necessary Research
The next thing you do want to do is to research the area you want to live in. You can change anything about a home except the location. So, it’s important to narrow it down by the zip code, the traffic in the area, the commute to and from your work, and the school district. Go in the evening and see the natural flow of that neighborhood and potentially get to know your new neighbors. Also, do your research in terms of recent sales in that neighborhood. You don’t want to rely on Zillow. Do not ever base your research on third party sites because Zillow doesn’t hire appraisers to go into homes to know the exact features of that property. For that, it is important to get a real estate agent.
Hire a Real Estate Agent
The last and most important thing to do is to hire a real estate agent who is committed to the career full time and has been in the industry for at least three years. You want an agent who knows the area and the market well. Do not hire an agent just because she’s your aunt or your cousin and you don’t want to hurt their feelings. When you get a new dentist you want to go with a specialist, not someone who just got their license. The same is true in real estate. This could be one of the most expensive investments you make. A real estate agent will hold your hand from start to finish and even beyond closings.
We’d love to hear some feedback on whether this information is helpful to you. If you have any questions, please contact us at PMP Carolinas, Inc.