It is a joy to work with first-time buyers. I love helping first-time home buyers find their first home and teaching them the process of buying a home. These are the three things you need to know before you begin looking.
1. Only work with one agent. It is best to work with one agent for your real estate search. Your agent will work with you to find the perfect property and negotiate all terms for your transaction. It is important that the agent gets to know you personally and your family so they can negotiate on your behalf. Remember that an agent who shows you a house is ethically the one who should handle the transaction. You are also dealing with the seller’s agents if you call an agent through a yard sign. Although most professionals can handle both sides of a transaction professionally it is more beneficial to work with someone you know well and who will look out for your best interests as the buyer. Your agent is not paid; the seller pays him or her upon closing. You are still hiring an agent to work for your business. Therefore, it is important to interview as many agents as possible and to choose the one you like best.
2. Pre-approval is required for financing. A lender must be pre-approved unless you plan to pay cash for your home. It helps you to set a realistic price range for house hunting. Frustration can result from looking at houses you cannot afford to buy. The mortgage lender will tell you how much you can borrow and also what your monthly payment will be. They will also give you information about closing costs and what you should do to protect your eligibility during the loan process. A current pre-approval is important to ensure you don’t lose your chance to buy another house. You will need to make an offer on the house you have found. The pre-approval letter must be included with your offer. I am happy to give you the names of local mortgage lenders who have been great to my clients.
3. There are some upfront costs. After you have found the perfect house and agreed on the terms and price, and signed the contract, it is time to pay your escrow deposit, also known as “good faith”, deposit. If you cancel the deal due to reasons not covered by the contract, this is money that you risk. It is usually between 1% to 5% of the sale price, but it can vary depending on the terms you and the seller have agreed to in the contract. During negotiations, your agent can help you with this. The escrow deposit is a part of the final sales price.
4. A certified home inspector should inspect the property. The cost of this inspection varies depending on how large, old, and what features the property has, but it is typically around a few hundred dollars. This amount will be due at the time service is rendered. Based on the results from the first inspection, you may choose to pay for additional inspections. If the inspector finds a problem with your HVAC system, you might need to pay a fee to have an HVAC contractor inspect it. To be able to move forward confidently with your purchase, you want as much information as possible during the inspection period.
5. A survey and appraisal of the property will be required. These costs are added to closing costs and should not be paid upfront. In the unlikely event of closing, however, you might be asked for a credit card number.
All of these steps will be covered during your home-buying journey. Are you ready to get started? Give Preferred Properties of Texas a call!