In this month’s blog post, we are going to talk about planning and how crucial it is when buying a home. Our team defines planning, as bridging the gap between where you are standing today and where you want to reach.
Planning involves setting objectives – what ‘needs’ do you want to be satisfied and deciding the appropriate course of action to achieve them. Planning allows you to look ahead and set goals for the future.
Which is why planning is so important for when you are buying a home. There are going to be questions and concerns you are going to have during this process and having a list of what you need to accomplish will make the process less daunting.
Step 1: Start Researching
In all actuality the first step is finding a trusted Real Estate Agent, homebuyers should always have their own agent. Buyer Agents work to negotiate the best terms and price for the buyer. Best of all, the buyer Agent’s services are free to the buyer although most people believe they have to pay a sales commission when rendering their services. The truth is this: only the seller pays the commission.
Start doing your own research, browse through web sites and newspapers to find information. Certain questions to ask while researching are; where do you want to live? There are plenty of different communities, but before you can start looking at homes with an Agent you need to have narrowed down a list of qualities your home ‘must have’ and where it should be located.
Step 2: Financial Stability
Knowing whether you are financially able to purchase a home; how much can you afford? If not, what other methods can you look into for purchasing a home? Having a Mortgage Broker that can assist you in reading over contracts, or finding a bank that will offer you the most reasonable interest rates are extremely beneficial. More often than not, your Agent can refer you to a trusted Mortgage Agent should need be.
Step 3: Get Preapproved for Your Mortgage
Getting pre-approved tends to be a more involved process. You will need to complete an official mortgage application, with necessary documentation to perform an extensive check on your financial background and current credit rating. The bank can tell you the specific mortgage approval amount. You will also have a better idea of the interest rate charged on the loan.
You then will receive a conditional commitment in writing for an exact loan amount, allowing you to look for a home at or below that price level. Obviously, this puts you at an advantage when dealing with a potential seller, as he or she will know you are one-step closer to obtaining an actual mortgage, which without, may discourage sellers from accepting your offers should you find a home you really want. A pre-approval is valid for 90 days and enables you to move quickly when you find the perfect place. This way, your Real Estate Agent wouldn’t waste your time showing you homes that are beyond your budget.
Step 4 - Part A: Why having a Real Estate Agent is Essential
It is unadvised that homebuyers try to buy homes with a sellers’ Real Estate Agent. The sellers Agent main concern is not about if you are getting the home for a reasonable price, but how much they can sell their clients home for. One of our previous clients told us about an incident that happened to their brother; he thought he was saving tons of money when negotiating with a sellers Agent. He did not have a Real Estate Agent of his own – that could have helped him look at other properties in the community and propose a fair market price that he should offer. He believed what the sellers Agent had told him. After closing the deal, he stumbled upon a listing in the newspaper for homes in that community, only to realize the Agent had overpriced the home.
Step 4 – Part B: Finding a Real Estate Agent
Real Estate Agents are important partners when you are buying a home, as they can provide you with helpful information on homes and neighborhoods that are not easily accessible to the public. Their knowledge of the home buying process and familiarity with the area you want to live in can be extremely valuable. Finding an Agent is not going to be an easy task, it can take months and countless interviews before you find an Agent whom you feel comfortable with. A good website to use when researching for an Agent is https://rankmyagent.com/. Find a knowledgeable and experienced Agent you can trust with verified reviews from clients in your neighbourhood.
Step 5: Shop for Your Home
Since you will be busy, your Real Estate Agent can construct a list of homes in your price range, that best suit your specific needs for you to visit. Discuss with your Agent any particular qualities you want your home to offer, or be near certain amenities. Having built a trusting relationship with your Agent, you can trust them to be knowledgeable of ‘must-haves’ your home should have and know what you wouldn’t mind compromising on. It might be helpful to take notes on all the homes you visit to properly assess what you want, or don’t want to eliminate seeing homes that just isn’t what you want. It can be hard to remember everything about them, so you might want to take pictures or videos to help you remember each home.
We hope that these steps are beneficial in your planning stages of buying a new home! If you have any further questions please, contact us.