Home Buying Tips
REALTORS® work hard to make the dream of owning a home possible for everyone. Here are some homebuying tips if you are considering making that move!
- Get prequalified – One of the first steps that first-time homebuyers should take is to meet with a mortgage lender to get pre-qualified to purchase a home. That way you will understand your overall budget factors and what monthly housing payment you may be able to afford based on the purchase price of a home. Make sure you ask plenty of questions to get an understanding of the home loan process completely, including other costing costs. Upfront Cost of Buying a Home (nar.realtor)
- Find a trusted partner, REALTOR®, that understands your goals and is ready to help guide you through the homebuying process. Discuss with your REALTOR® your expectations and the price range that fits your budget and the locations/list of neighborhoods of where you would like to purchase. Your REALTOR® will develop a roster of available listings given your search parameters for you to review and updated on a regular basis. The REALTOR® will show you select properties you wish to see. Make sure your REALTOR® helps to find you the latest listings and is responsive and communicating with you during your home search. Your REALTOR® will help you present your offer to the seller and be with you every step of the way through your offer to closing.
- Homebuyers often think they need 20 percent or more for a downpayment, but the actual amount is far lower and there are a variety of down payment assistance and mortgage financing programs available to help buying a home more affordable. 9 home financing programs to help buyers get into a home (Illinois REALTORS brochure)
- Watch the mortgage rate market regularly. Shop around on mortgage rates. Lower rates improve your purchasing power and help make homeownership more affordable. But, the days of 3 and 4 percent interest rates are over for the time being due to higher inflation. Mortgage rates tipped to a high of 7 percent in 2022 and have reduced since then hovering just above 6 percent, the new normal right now. Mortgage rates are very fluid and move up and down weekly as they are tied to actions made by the Federal Reserve and other economic factors.
- In the long run, owning a home will benefit you greater than renting. The cost of rent continues to increase and by owning your own home you are building your own household wealth and not your landlord’s. If you wait to buy and keep renting you will miss out on the opportunity for you to build your home equity. Overall home values will go up steadily over the next few years, and waiting to buy may mean it will be more expensive to purchase later.
- Be ready to act quickly. In this low-inventory market, properties are moving fast, and you need to be ready to put in your offer to purchase with the assistance of your REALTOR®. By delaying your offer, you may miss out and someone else may have already purchased the home you want. There are certain times of the year that are hotter in the market than others but in a low inventory market there is no time to waste on making an offer as properties sell quickly in attractive price ranges. Some sellers receive several offers and can only choose one offer from a buyer. Also, you may need to be flexible in terms of location and home amenities. When viewing properties, remember it is common that a little fix-up work might be needed, typical for even newer homes. It is all about choosing the home you see yourself being the most comfortable in. Sellers typically lived in their home for 10 years before selling according to the NAR Profile of Homebuyers and Sellers. Be ready to act with the help of your REALTOR® to find the right house that fits your needs. 9 home financing programs to help buyers get into a home (Illinois REALTORS brochure)
How to prepare to buy a home:
(Document) How to Prepare to Buy a Home (nar.realtor)