If it’s your first time buying a home and you feel uncertain, or you’re intimidated by the current seller’s market, you’re not alone. A recent study showed 52% of millennials (those between 23 and 38) want to buy a home, but half are anxious about the process. Of those who already had mortgages, only 27% felt like they understood the process from the beginning.
Daunting as buying a home may seem, building confidence as a buyer is possible. Read on to learn how you can feel ready for the biggest purchase of your life.
While pre-qualification is a good indication of whether or not you can get the desired loan amount, pre-approval is the official answer. To be pre-approved for a loan you, the borrower, must complete an official mortgage application, provide requested documentation, and be submitted to a thorough credit and financial background check. When you begin with this step, you can be confident in how much home you can afford right off the bat.
Educate Yourself on the Process
Hire the Right Professionals
If you were looking for a good doctor, you wouldn’t pick the one with the lowest fees. You’d do your research to find someone who was trusted in their community, had excellent reviews, and professional success. Buying a home and getting a mortgage are the largest financial decisions you will make in your life. Get the right team behind you, so you can approach the process with confidence.
Be Certain on What You Want & Where You’ll Settle
Establish your “must-haves” and “would likes” early so you can make confident decisions in a competitive market. Once you make the list, consider how much extra you’d be willing to pay for various elements and make note of it. If you are home shopping with another person, this can also foster unity in decision-making.
Know What the Property is Worth
When you find the home that fits your criteria, start talking to your agent about a competitive market analysis (CMA) of the home. It will incorporate comparable recent sales (sometimes referred to as “comps”), a history of the home’s previous valuations, and an analysis of its current value based on the local market.
Also, consider the current state of the market regarding inventory and interest rates to make sure the valuation of the property is accurately reflected by comps. Since comps are based on nearby home sales, they can be slow to catch up with the market if low inventory means local sales are rare.
We Can Help You Compete in a Seller’s Market
Buying a home can feel overwhelming, but we know what to do to get you the loan you need and connect you with real estate professionals you can trust. If you’d like to learn more, reach out to us at (877) 699-0353.