Before you even begin to start saving properties and calling agents, you have to get your finances in order. That begins with cleaning up old debts, improving your credit score, and building up healthy savings to put down a 20% down payment if at all possible. Get this done first.
At the very least, most banks will require 5% down. Just know that lenders will typically require you to pay private mortgage insurance (PMI) if your down payment is less than 20%
Once you have your financial ducks in a row, it’s time to start preparing for the house hunt. The first step is actually going to a bank and getting pre-approved for a home loan.
Keep in mind that pre-approval and pre-qualification are two different things:
• Pre-Qualification: Only tells you how much you can afford for a home.
• Pre-Approval: Tells you how much the bank will guarantee to lend you for a home.
When you go to an open house with a pre-approval letter in hand, the seller knows that you are a serious buyer. Plus, knowing exactly how much you are approved for can help you stay within your budget. When budgeting for your home purchase, don’t forget to include other costs that will arise like:
• Inspections
• Repairs
• Closing Costs
• Contingencies
• And Other Fees
Purchasing a property is most likely the biggest financial decision you will ever make. Whether this is your first purchase or you are an experienced buyer, this decision must be made carefully.
Why Do You Want To Buy?
Are you tired of paying rent? Have you decided to pay your own mortgage and not your landlord’s? Have you outgrown your current home? Are you looking for an investment portfolio? Are you looking for a rental property? Would you like a larger yard? Would you rather live in a different area? Do you want to shorten your commute? Having a clear sense of your reasons for buying will help you choose the right property.
Has Your Income Grown?
Property ownership is an excellent investment, whether you are looking for your dream home, a rental property, or expanding your investment portfolio. Owning real estate is one of the least risky ways to build equity or to obtain a greater return on your initial investment.
Very few people attempt to buy their first home without the aid of a qualified agent. Those who do take on the task themselves often believe that they will save on costs. However, where an agent matters most is during negotiations. They are in the best position of all to negotiate on your behalf.
In fact, buyers who do not work with an agent tend to spend upwards of $10,000 more for a home than those who can call on the skillful negotiation prowess of a top real estate agent. If you do enough research, you could find the home that you want.
But to get it at the price that is best for you, you need an expert. Contact Parisa today to help you get the best deal!
First time home buyers: Parisa is the best! We were referred to Parisa by a friend, and we are so grateful for it. She was an absolute pleasure to work with and great energy to be around. Being in the Bay Area, where it is such a competitive market, it was great to find someone with her background and knowledge. She listened to what was important to us in a home and quickly found value within our budget in locations we desired. As first-time home buyers, we were very nervous starting the process, but Parisa made sure to take the time always to listen, feel our energy, and answer any questions we had. When we found the home we wanted to offer, Parisa recommended our writing a letter to the seller introducing ourselves as first-time home buyers. When deciding on our offer, we make it competitive and within a range with which we felt comfortable. My wife and I wrote our letter, decided on our offer, which Parisa agreed was strong, and we submitted. We came in 5K under the highest offer, but thanks to Parisa's negotiating skills and our letter, they decided to work with us! We agreed to match the highest bid, and we confidently closed in 21 days. Parisa and the mortgage lending team she recommended were integral. They know exactly what they're doing and kept us calm and confident during the quick, 21-day close. We are happy with our purchase. It’s absolutely perfect for us. We'll miss working so closely with Parisa. But we will always keep in contact and highly recommend her to anyone looking for a home. Parisa is a true professional who has her buyer's best interest at heart. Thank you, Parisa!
Jenn S. Represented Buyer