The home buying process explained
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The home buying process explained

If you’re looking to purchase your first home, it’s a daunting time. The home buying process can be complicated, so heading into it with no prior knowledge is scary. In order to relieve the worry, we’re here to provide a definite guide to the process, perfect for those taking the plunge for the first time.

Prepare yourself

Buying your first home is a huge life decision, so it’s important that you don’t head into the process without having done plenty of research for yourself. Getting yourself that background knowledge will really help, and make the process of home buying much more straight forward. As with most things, having a greater understanding will allow you to make a more informed decision further down the line.

Get the right mortgage

One of the most important factors when buying a home is to ensure you get a mortgage that suits your financial and living situation. Again, this will involve copious amounts of research and homework. If you’re unsure what types of mortgage are out there, it’s worth looking into, and getting the facts straight in your head before going out into the market.

Make your offer

Once you’ve got your mortgage lined up, viewed homes and are now ready to proceed, it’s time to put in an offer on what you want to be your new home. If you’re a first time buyer, you’ll have less constraints, as you won’t have an existing home up for sale slowing you down. Usually, you’ll put your offer in through your estate agent, as they will help your deal go through as smoothly as possible

Sort your paperwork

Next up, you’ll need to get your solicitor to handle the paperwork surrounding your impending move. It’s important that the finer details of your move are scrutinised ahead of signing your papers, so having a trusted solicitor on your side is an important addition.

Carry out a survey

Another crucial step is to ensure that you arrange for a survey of your new property to be carried out, to make sure that your new home has been thoroughly checked over and is valued at the price you’re paying. There are a number of different surveys and reports which can be carried out, from the cheaper condition report to the most comprehensive option of a structural survey.

Exchange contracts

Once your solicitor and surveyor are happy, it’s time to sign the contract and move ahead with the purchase. It’s at this point you’ll have to start the expenditure, as you’ll usually have to lay down 10% of the total price as a deposit. It’s important to know that once you put down the deposit, you’re committed to the sale, meaning that if circumstances change any you need to pull out of the deal, you’ll likely lose your deposit.

Complete the deal

Upon completion, the property finally becomes yours. It’s time for you to get your keys and the deed to your first home. The completion of your purchase means you’ll now have bills to pay; the 90% of your home which you’re yet to pay for is transferred from your mortgage lender to your legal representative, and then on to the seller’s representative.

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Avoiding mistakes as a new home owner
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Avoiding mistakes as a new home owner

First-time homebuyers may not have the burden of a house to sell in difficult times, but they can still make a lot of mistakes during the buying process.

Leaving Financial Planning for Later

There are a lot of online calculators and tools to help you determine how much you can truly afford before you start the buying process. Here’s a great mortgage calculator by The Nest. However, when you start getting serious about buying a home, you need to know exactly how much you can put into a house and hopefully, get pre-approved for a mortgage.

DIY Home Buying

With all the classified listings out there, along with websites like Craigslist and apps like Zillow, you may start looking at homes ages before you ever contact an agent. But wait, do you even need an agent? Can’t you just figure this out on your own? Well, maybe, but buying a home is an incredibly complicated process, and it helps to have a real estate agent to coach you through the ins and outs of financing, scheduling inspections and making an offer.

Falling in Love Too Soon

Many first-time buyers become enamored with one particular property and suddenly it seems like they’ve just got to have it. But, this is a bad idea where home buying is concerned. Not only can falling in love with a home make a difference with the real estate agent — they’ll make you pay for it — but you can be setting yourself up for heartbreak if it isn’t in your budget or another buyer makes a better offer.

Renovating Too Soon

Even if you don’t let yourself fall in love before you can afford it, you may come into the home with a very specific work-in-progress vision for your home. Maybe you want to remodel the kitchen right away to make it the airy, open-plan cooking space you’ve always dreamed of. Maybe you want to add a conservatory or tack on an orangery.

The increase in value to the home will practically make these renovations pay for themselves, right? Well, it may not have the effect you were hoping for. In this unpredictable market, you never know if making upgrades will reap the rewards you’ve been hoping for or be a thousand pound mistake in the making.

Forgetting That There’s More Than the Mortgage Payment

First-time homebuyers may know what they’re getting into as far as the monthly mortgage payment is concerned, but there is so much more to homeownership than your mortgage. Suddenly, you’ve got additional taxes, home insurance, higher utility bills and maintenance to contend with. These things can overwhelm those used to renting.

Be sure to estimate the cost of living, as well as the mortgage payment before you close on the deal. There are a lot of ins and outs to buying your first house and you’ll always run into things you didn’t expect or plan for. Fortunately, if you avoid making these five common mistakes, you are well on your way to finding the home of your dreams at a price you can afford.

Photo Credit: MarkMoz12 via Compfight cc

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5 mistakes to avoid when buying a new home

5 mistakes to avoid when buying a new home

Buying a home can be both exciting and stressful. On one hand, there is nothing like achieving ownership of your own personal space. It is the area that you will create dozens of memories and maybe even build or grow your family. On the other hand, it is stressful because in many respects, buying a home can leave you in an unpromising financial situation. However, this does not need to be the case. While most homebuyers make serious negotiation errors during the process of buying a home, these mistakes can be avoided. Below you’ll find the top 6 mistakes that you should avoid. This way, you can be sure that you are getting the best deal for your dollar.

 

Pre-Purchasing Home Inspection

One of the biggest and most serious mistakes that homebuyers make before signing on the dotted line is opting out of getting a professional to do a thorough home inspection. Naturally, when purchasing a home, homebuyers will also allocate funds towards remodelling rooms and new furniture. However, without a pre-purchasing home inspection, the new homeowner ends up finding that there are dozens of structural issues with the home. You can avoid this issue by hiring a professional to conduct a pre-purchasing home inspection.

 

Pricing

Another common mistake that homebuyers make, especially when purchasing without a real estate agent, is that they will easily overpay for a home. While not doing a pre-purchasing home inspection leads to overpaying, so does not reviewing the pricing of homes in the area. Therefore, to make sure you aren’t being overcharged, do some research and review the prices of homes in the area. It will give you an idea of range you should be paying in and give you negotiating power when talking with the seller.

 

Feelings

For some people, masking their feelings can be especially difficult. However, keep in mind that it is crucial that you remain neutral when viewing a home. Showing enthusiasm and love for a home during a viewing or through the negotiation process can spell trouble. Usually, the seller will notice your feelings and gain the upper hand, which will result in you paying more.

 

Seller Motivation

One trap that many homebuyers fall into is to not question why the seller has put their home in the market. While in some cases, the seller wants to move elsewhere, it can also be the case that there are other issues. Therefore, in order to protect your investment and add to your negotiating power it is a smart move to ask why the seller has their home on the market.

 

Keep Your Options Open

Sometimes, home sellers notice when a homebuyer is desperate to buy a house. This scenario immediately increases the seller’s power, and reduces your negotiating chances. Also, you do not want to put all your hopes into one home. Thus, when searching through homes, it is best to keep your options open. Look through a number or properties and make a list of your favourites. This will help you keep calm when facing negotiations with a homebuyer and increase the chance that you’ll get the property that you want for a fair price.

 

Author Bio

Brad Porteus is the Managing Director of BSP Construction Consultants, investment property inspection specialists in Perth, Western Australia.

Photo Credit: kevin dooley via Compfight cc

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Lorem Ipsum
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Lorem Ipsum

Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry’s standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

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