Buying 101

Buying 101 Nest Realty

The First Five Steps to Buying a Home

At Nest, we believe that buying and selling real estate is the most important financial and life decision you will ever make. In this blog post, we’ll go over the first five steps to take when buying a new home. These steps apply to both first-time buyers and seasoned homeowners. Read on to get a head start on the homebuying process:

Step 1: Buyer’s Best Friend

It’s time to make a new friend who will be a key player as you go through the home buying process: your buyer’s agent. First, rest assured that buyer’s agents are not expensive, since the cost of representation is typically already factored into the price of the home. Your buyer’s agent should be your greatest advocate as you search for your next home. Don’t just settle for anyone! Interview as many agents as it takes to find the right fit, since you’ll be trusting them with helping to guide you through making one of the biggest decisions of your life.

Nest buying 101 agent

Things to look for in a buyer’s agent:

  • Communication—extremely important! You don’t want to work with someone who won’t return your calls. (Make sure to communicate how you want to be communicated with—do you prefer email, text, phone, WhatsApp, Signal, etc.?) You also need to find someone you can be open and honest with about your needs, expectations, and abilities throughout the process.
  • Honesty, integrity, and trustworthiness—your agent will have access to your sensitive financial information. They will also be your mouthpiece during the process, so you need to know they have your best interests at heart.
  • Real estate knowledge and experience—you’re hiring an expert, so find someone who knows what they’re doing. Your agent will be the one helping you find the best deal and negotiating on your behalf to get it done.

In Virginia, you’ll need to sign a Buyer Broker Agreement. This solidifies your relationship with your agent. It can be short term, so don’t fret over locking yourself into a contract with someone who turns out to be a bad fit. Even so, read this agreement carefully so you aren’t surprised by anything.

Step 2: Research Time!

Before you can begin looking at homes, you need to research two important things: the housing market in the area you’d like to explore, and your own financial abilities. You never want to go into the home buying process blind. Request your credit reports and make sure you know about anything in your financial history that could impact your borrowing power. Check carefully, since errors do crop up sometimes that can have a negative affect if not corrected!

Nest buying 101 research

Research the homes available in the area you want to look, and think about how much home you can truly afford. Stay up to date on the state of the housing market by using tools such as Nest’s online market reports. It helps to stay informed on how long homes stay on the market before selling, how much inventory is available, and the average difference between list price and sales price for properties. This information can empower you to make the right decisions as you continue the process. Your buyer’s agent can help you interpret the data so you feel comfortable taking the next step.

Step 3: Mortgage Prep

Next, it’s time to get pre-approved for a mortgage. Pre-approval is important because it will give you (and the home sellers you’ll be dealing with) a concrete idea of what you can afford. Research lenders in your area and meet with several to discuss your options. Or, ask your buyer’s agent for recommendations; they probably have several with whom they work frequently, and trust. Working with a local lender can be one of the best decisions you make in the process. Lenders are not just there to give you loans; they are also a resource for crafting a financial plan to help you reach your homeownership goals. Be sure to research the mortgage process before meeting anyone so you are familiar with points that may come up in conversation.

When it’s time to get pre-approved, use this list to gather the materials you will need to have on hand. These materials include personal background information such as previous addresses, credit history, financial assets, tax info, and more. Preparing ahead of time will make this step in the process much smoother!

Step 4: Know Thyself

Step four is more introspective, but just as important as steps one through three. Once you know how much you’re pre-approved for, take a hard look at your monthly finances to see what kind of payments make sense. If you’re currently renting, a good rule of thumb is to aim for monthly mortgage payments at the same level as your monthly rent payments. This will help keep your budget steady. If you can lower your monthly payment by buying rather than renting, that’s even better!

As you think about home affordability, be honest with yourself about how much maintenance you are willing to take on. Sure, a fixer upper might be cheaper up front, but will you be able to afford repairs? Are you comfortable doing much work yourself, or will you need to hire outside help to maintain your home? Check out this post for a more detailed overview of what you need to consider.

Take the time to write down what is important to you in a home (your needs, wants, and would-like-to-haves). Some things cannot be compromised, but it helps to be flexible if you can. Rank what you can and can’t live without—perhaps having four bedrooms is more important than having granite countertops, for example. Maybe the location of the home is more important to you that its architectural style or layout. Your buyer’s agent can act as a sounding board to help you through this step.

Step 5: The Search Begins

Now for the fun part! Once you have your finances sorted and a buyer’s agent on your team, go out and start looking for homes. Visit open houses, scroll through photo galleries online, and don’t forget to be honest with yourself about what is working for you and what isn’t as you explore available options. Before you know it, you’ll be able to make a solid offer on the home of your dreams!

Nest buying 101 family

To recap….

The First Five Steps to Buying a Home:

1. Find a buyer’s agent.

2. Research your credit history and the housing market.

3. Get pre-approved for a mortgage.

4. Make a list of your needs and wants in a home.

5. Begin searching for a home.

Check back next week for the First Five Steps to Selling a Home!

Spread the love

Written by
Posted in Asheville, Charlottesville, Fredericksburg, Jackson, Lake Norman, New River Valley, Raleigh-Durham, Richmond, Roanoke, Shenandoah Valley, Wilmington
Tags: , , , , , , ,
Comments closed

Comments are closed.

Join our Newsletter

×