You decided to be a buy a home! Now what?

While many first time buyers do not know, there are several steps to take before even opening the door to a potential house. Your real estate agent should be able to assist you through all the process.

1) Speak to a mortgage officer

The goal is to find out about your lending situation. For every buyer, it is vital that you know what house you can afford to decide whether it is the right time to buy. And the only way to know the actual picture is to actually talk to the bank.

2) Get Pre-Approved

Getting pre-approved upfront will allow you to move quicker when it comes to making an offer. Offers for home usually need to be submitted with proof that you can obtain the financing for the house. Thus, if you have already been pre-approved by the bank, your offer will be able to be submitted quicker. This ensures you a higher chance at getting your dream home.

The key is to get pre-approved, not pre-qualified. There is a difference in the quality of the approval. Being pre-qualified is an approval from the loan officer, while being pre-approved means your loan is actually reviewed by an underwriter.

Another important point is to get pre-approved for the highest dollar amount you think you might possibly borrow. You don’t want to end up falling in love with a $300,000 home when you are approved for $250,000.

After you are pre-approved, DO NOT make any major financial changes. This includes financing a new car, or changing jobs. Review the things you should not do in the article here.

3) Speak to a Realtor about the housing market

The goal is find out what kind of market you are in. Are the home values high or low? What is the inventory level on the market like? What other kinds of buyers are out there? Are there mainly investor buyers, or owner-occupied? Is it a seller’s or buyer’s market? What is the average closing time? Are homes paid cash or financed? Are home values rising or falling?

All this information will help you determine how informed your Realtor is about the current housing market. It will allows you to not only find a good Realtor, but also gives you an idea of what you need to do in order to have an offer accepted.

4) Decide what kind of home you wish to live in

Now that you learned about the housing market, find out what kind of house your money can get you. Let your Realtor know what you are looking for. Please don’t be shy about your wish list. Sometimes I will show my clients many nice home with pools before they tell me, they actually want a single story with no pool.

Descriptions like big and small are very subjective. Let your Realtor know what you are looking for. 1500 sqft.? 500 sqft.? or 5000 sqft.? Especially if there are certain things that are deal-breakers, be vocal about your wish. This way your Realtor can find the best fit for your needs.

5) Find out how many homes are available base on your criteria

Work with your Realtor and find out how many houses are available with the criteria you mentioned above. Are they in your budget? Do you need to increase your budget or lose some criteria?

When you are finally down to a good selection of houses, you are ready to go out and view your properties.