Purchasing property is most likely the biggest financial decision you will ever make. Whether this is your first purchase, or you are an experienced buyer, this decision must be made carefully. You should be clear on what you are looking for, what you want to do with it, and how to make it happen!
Deciding to Buy
• Have you outgrown your current home?
Or are you an empty nester looking to downsize?
• Are you relocating for your career? Or family
• Do you want to shorten your commute?
• Would you rather live in a different area?
• Are you tired of paying rent? Have you decided to pay your own mortgage and not your landlord’s?
• Are you looking for an investment portfolio?
• Do you want to hold property for future markets, develop, flip it quickly, or draw passive income?
Property ownership is an excellent investment; whether you are looking for your dream home, a rental property, or to expand your investment portfolio. Owning real estate is a very popular way of building equity or obtaining a greater return on your initial investment.
Preparing to buy
Before you start shopping for your property, it is a good idea to make some preparations.
Decide how you are going to make your purchase and determine your Buying Power!
If you are planning to use cash or seller financing, you will need to make sure you are clear on how much you are able to spend and make sure that the funds are readily available. You may need to consult with your financial advisor or Accountant in preparation for tax and money management implications.
Build your file
If you plan to finance your transaction, you will want to build a file of documents and information that your lender will look for in order to fully approve your loan.
This file contains all your important financial documents and will typically contain:
• Financial statements
• Bank accounts
• Credit cards
• Auto loans
• Recent pay stubs
• Tax returns for two years
• Copies of leases for investment properties
• 401K statements, life insurance, stocks, bonds, and mutual account information.
Check your credit!
Your credit score will have a significant impact on your buying power. You can obtain free credit reports through the credit reporting agencies Equifax, Experian, and Trans-Union.
You should speak to a Loan Officer about getting pre-approved for a mortgage. If you have worked with lenders in the past, you can start there, or we have fantastic relationships with many local and national lenders who have done a phenomenal job for our clients in the past that we would be happy to recommend!
Now that you know your Buying power, you are ready to choose a realtor and start shopping!
Be Careful with Your Finances!
Now is not a good time to make sudden career changes or large purchases. You want to approach your property purchase from a position of financial stability and sudden changes during your buying process can affect your buying power substantially!
Now your ready to go shopping!
Funnel your search
Select the properties that interest you the most and have your real estate agent make appointments to visit them. Make sure to keep them informed on what you like or dislike about the properties so they can continuously develop their search strategy for you!
Time to buy
Once you have chosen the property you want to purchase, your Agent can help you make an offer that the seller will accept. Your agent will investigate the potential costs and expenses associated with the new property, provide you with insurance quotes from their professional network, help make sure that the property is suitable for your plans, orchestrate your inspections, negotiate any due diligence requests, and act on your behalf to ensure all of the moving parts of the transaction are completed on time for your closing!