Many people dream of buying a house for years or even decades before they have even begun the process or started saving. Many first time buyers have already thought about how many bedrooms they want, what neighbourhood they would like to move to or to some extremes what colour the walls are going to be in certain rooms. However, there is much more to purchasing a home than picking your favourite listing and moving in. It’s important to understand all the steps of buying a home.
Steps to purchasing a house
Before you can accept the keys to your dream home there are lots of steps to buying a house that many people don’t consider. We understand that the process can be stressful and challenging as it is like nothing you have ever done before. The path becomes a lot easier when you have a clear plan.
Here are the steps you must consider
Take stock of your personal finances
You won’t be able to buy a home until you know what you can afford based on your personal finances. Be sure to keep track of your credit score and try and improve it as much as you can. The better your score is the easier it will be for you to get approved for a mortgage – yes you have to get approved for a mortgage, many people don’t know this and think they are guaranteed one, however this is not the case! You should also look at how much you have saved for a deposit. Generally, homebuyers are expected to put forward between 5-20% of the price of the property as a deposit.
Research the local market
Long before you actually put an offer on a home, you should be monitoring the condition of the market in the area where you will be purchasing the home. Pay special attention to the length of time that most homes in your price range stay on the market for and if there are any big shifts in the asking price. Speaking to your local estate agent can help you recognise these key points.
Go through the pre-approval process
You might be able to assume what your house budget will be based on your finances and credit score but speaking with a lender will help you determine a specific number. In order to get a pre-approved mortgage, you will have to provide your lender with some financial information including your debts and assets.
Many people are expecting to get too much for the money they have when they are buying a home, when looking at what you “want” and what you “need”, you need to be realistic. It’s unlikely that you’ll be able to find your dream home the first time you buy one – so you need to create a list of things you’d be willing to compromise on (wants) and a list of things you absolutely can’t go without (needs). This will help you understand if you’re getting what you need for the right price.
Apart from the obvious monthly mortgage payments, there are a lot more costs to buying a home. Some of the extra costs include:
- Surveying costs
- Solicitors fee
- Removal costs
- Building insurance
- Initial furnishing and decorating costs
- Mortgage arrangement and valuation fees
- Stamp duty – land and buildings tax
We hope that this blog was helpful if you have any questions about buying your first property please don’t hesitate in giving us a call on 01536 238660 or heading over to our contact page.