Thank you so much to Chase for sponsoring this post! All opinions are mine.
The 5 Steps to Buying a Home and How the Process is Changing
Home ownership has been and, likely, always will be the American dream. It’s also likely the biggest purchase that you’ll make in your life. The basics steps to buying a home have been the same for years, but technology is rapidly changing the details of the process. I’m really excited to partner with Chase, a frontrunner in helping to make the home buying experience easier during this busy real estate season.
Chase recently released a national survey, “Insights from the Mind of the Modern Homebuyer,” which found that technology is shifting the way that we buy our homes. You can read the results of the survey here, but I’ll hit the highlights below.
The most surprising finding was that 3 in 4 homeowners don’t plan to stay in their homes long term – which suggests that people are interested in upgrading as their situation changes. That’s a drastic change from the way the previous generation (and me!) viewed a home as a place to settle in for life.
There are five steps to home buying that will make the process easier, most of which you can use technology to help with.
Prep your credit.
Check your credit score and credit report for inaccuracies. The earlier you do this before you start looking at homes the better because you’ll have time to fix inaccuracies and improve your report. You can do this easily now with websites like Credit Karma or Credit Sesame or at annualcreditreport.com.
Budget.
Get a budget in place and working. Calculate how much house you can afford including closing costs, down payment, and appraisal and inspection. You can find a mortgage affordability calculator at Chase to help you.
Get help.
Find the right real estate professional and a lender to help you select the right home and the right mortgage for your unique situation. Check reviews before choosing and meet with them over the phone or in person with a list of questions. Look for someone who takes your questions seriously, demonstrates knowledge of the process and personalizes their answers to your unique situation. You can talk to a mortgage lender at Chase to determine the mortgage that’s right for your situation.
Start with the lender so you can get prequalified, which is helpful for the real estate professional to have as they book appointments to look at houses.
Now is also a good time to talk to your lender about the different mortgages available to you, whether there are grants that you would be approved for, and the amount of money you would need at closing. You can compare fees and make a decision at this point.
Make sure that you ask for the total amount of money needed (including things like real estate agent fees, inspection, appraisal and closing costs) so that you aren't surprised.
Also ask when the total amount of money would be needed, since you’ll need to have the money in your account about two weeks before the closing date in most cases.
Both the lender and the real estate professional are paid when you buy your home, not before, so you won't need to pay them upfront. If you decide not to purchase a house after all, then you won't be paying them.
This is one of the only steps that technology hasn't changed that much. In fact, 73% of Americans agree that they would want to meet with a mortgage professional as they consider financing options and 77% also feel that a real estate agent is essential.
Find your home.
Make a list of what you want your home to have. List everything from ample parking to a soaking tub. Prioritize your list and set a “must have” limit. Start looking at the homes that are available in the areas you’re interested.
It’s never been easier to find tons of homes and compare their features and price easily using apps like Redfin and Zillow. You no longer need to wait for your real estate professional to send you available homes. In fact, Chase found that 68% of Americans start the search on their own (45% using a computer, 13% using a mobile device, and 11% using a newspaper or magazine).
Look for the historical value of the homes in the area (which you can do easily now on apps like Zillow) but understand that you can't predict the future with accuracy. Despite that, Chase found that Americans are optimistic about the value of their home and are seeing the value in reinvesting in their homes. In fact, Chase’s survey shows that 38 percent have used or are considering a Home Equity Line of Credit in the next five years, with the majority (58 percent) putting it toward home improvements.
Buy your home.
Your real estate agent and lender will walk you through this process, but there are a few things you should keep in mind. You’ll need a “money in earnest payment” at the time you sign a contract on the house. This is usually a small percentage of the home price (about 1%) but can vary based on your market. Most contracts are written so that if your financing falls through, then that money would be returned to you. Depending on when you close, you’ll likely skip a month of mortgage payments as the new loan goes through.
Once you get through closing, then the real fun starts… moving! And moving makes the process of buying the home seem easy in comparison!
Buying a home has changed a lot over the years, but it’s still one of the most important (and stressful) moments of your life. We all know that planning for, and meeting financial goals — including buying a home — isn’t always easy. Chase is committed to helping people be in control of their finances no matter their stage in life
To begin your journey to the front door, I’d encourage you to visit Chase where you can also find out more on the survey and homebuying tools and tips.
How old were you when you bought your first home?
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Aliyyah @RichAndHappyBlog says
April 14 at 9:32 amI may be buying a home in a few years, most likely a condo. So this information is helpful. I love looking online at the different options out there.
Aliyyah @RichAndHappyBlog recently posted…3 Tricks Retailers Use to Get You to Spend More Money
Tiffany says
April 15 at 3:32 amI plan to buy within the next 3 years! I am taking a first homebuyer course next month to help get started with the process!
Becky@Frametofreedom says
April 15 at 12:43 pmGreat tips! Making sure you can comfortably afford the new home is such great advice. And making sure you factor in closing costs. Thanks for sharing a great article!!
Becky@Frametofreedom recently posted…Real Estate for Beginners: 3 Most Common Questions Answered
Mali says
May 4 at 10:04 amThanks for the tips! We are currently looking to buy our first home and we have a realtor and mortgage broker, but finding the right house for our family while staying within our budget is a challenge!
Morgan says
May 10 at 4:09 pmThis is excellent advice! It is definitely nice to have tips like these at hand when you are looking to buy a new home. A lot of people don’t know where to start, so this was a very insightful and helpful post. Thank you so much for posting!
Margaret says
June 16 at 6:50 pmThanks for the great read! I just cant decide if we should buy or rent. Maybe, I’ll have to revisit this post when I made up my mind.
Gregory Willard says
August 16 at 10:36 amI have a friend that is starting to look into buying a house for his family, and they aren’t sure what to do. It’s a great idea to come up with a budget beforehand. It would be very nice to be able to track how much you need, and how much you have.
Harry @ Property Management Company Greenville says
October 6 at 2:19 amActually buying a home is thrilling and nerve-wracking for first-time home buyer. It’s very difficult to identify what exactly expecting. If you think about your emotions, then it will obsess with the paint colour or the backyard. So you should be stay calm and be wise if you are new on this.
vicjoshi says
October 10 at 7:33 amHi,
This is such an interesting & helpful guide for home buyers. Its true that home buying procedure has been changed a lot for past few decades. Home buyers have become more learned now and they know where they should put their money.
Thanks for sharing the steps. 🙂
Michael B says
October 11 at 12:55 amFinding a perfect home as in our choice for sale is not easier as we think. So we can search some real estate agent directory to work with a professional realtor and find our perfect home.
Brian says
October 12 at 3:00 pmThanks for the tips on home buying. I found the infographic really easy to understand!
Shad Morris says
November 22 at 10:22 amIt has been years since I have bought a house, and was curious about how to do it now. It makes sense that you should check your credit for inaccuracies. That way, you can fix it before you get too deep.
Elena Malta says
December 14 at 6:11 amGreat tips Rosemarie! I’m actually looking for a new house and I really need these kind of tips since this is my first time buying a property. Thanks!
Jonathan Elliott says
January 17 at 2:50 amThe article shared above is awesome. I think one should be very careful before buying house. Because it’s a lifetime investment. People those who are planning for buying a should check out this site (http://www.topperrealestate.com/). I came to know about this site when I was surfing on net.
Bernard Clyde says
February 6 at 1:36 pmI appreciate you listing budget towards the top of your list of tips. I think budgeting needs to come into effect far in advance if you want the best opportunities to choose from when house hunting. Of course, it always helps to have an agent who can help you find the right options based on your budget.
Prosperity Mortgages says
February 9 at 12:50 amWow these are such great ideas.I need to look into ‘Credit Report’. I have heard great things about it!
very nice article, i loved it , keep posting stuff like this.
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Devil says
February 10 at 2:43 amHey!!
One of the best tips for home buyers is to have a wide choice of homes to compare and choose from.
Once you have short listed a few of the homes you have seen, you can start preparing a list of essentials you would expect from your new home. This list can include location of the home, accessibility to public transport, a general survey of the neighbourhood, the design of the house, size of the rooms, any possibility or history of natural calamities such as floods, etc. Great tips for home buyers always encourage buyers to keep ready a list of essentials prior to making the final choice.The tips you mentioned here are awesome.
Thank you so much for great sharing.
Devil recently posted…Contractual Joint Ventures for Real Estate: A Word Of Caution
Laurel Santos says
February 14 at 4:09 amThis is so helpful! I’d save this one so I could use it as my future reference. Love the infographic as well! Kudos
Mike Dy says
February 22 at 5:15 amGreat tips! Thanks for sharing. I like that you included get help. Since skilled realtor are very helpful especially if your a first time buyer and you don’t know anything about the process.
Henry M. Webber says
March 21 at 4:14 amI think we all should remember this before buying any property. Because the process you described is really brilliant and I hope it’ll guide us.
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John Esquival says
March 31 at 7:41 pmThat’s a good tip to prep your credit when planning for a home. You’ll want better credit to get a good mortgage. That funding can help you with renovations too if you get certain types of mortgages.
Orlando HBP says
April 2 at 3:19 pmSuperb and helpful! 🙂 The process is really helpful. And, do you know I can’t wait to try them for my first house in Orland? Thanks and waiting for a better experience in the near future.
Kyle Winters says
May 3 at 8:13 pmI do like that one of the first pieces of advice you give is coming up with a list of things your new home has to have. After all there are a few essential things like air conditioning and plumbing that we need to make sure any house we buy has. You can add things that you would like the home to have to the list as well, but you should always prioritize the necessities.
Carroll Davis says
May 26 at 6:01 amGood to read!
LNWeaver says
June 7 at 8:03 pmI like your tip to check your credit report for inaccuracies. Having a good credit score can really save you money on interest. Interest can be a gauge of how trustworthy a borrower is, after all.
Lucy Gibson says
August 28 at 7:08 pmMy husband and I are hoping to purchase a home at some point. We just found out that we’ll be having twins, so we’ll need something bigger than our 1 bedroom apartment. I love your tip about making a list of “must haves” and setting a limit on it. This might help narrow down the search.
Lucy Gibson recently posted…Home Maintenance Tips for the Spring Season
Abby says
August 29 at 10:04 amThese are great tips! I especially loved the infographic. It was easy to understand and I was not aware of most of those statistics. Thanks for sharing!
LNweaver says
August 30 at 8:52 pmThat’s a good tip to figure out how much house you can afford. House expenses include closing costs, down payment, appraisal, and inspection. A down payment is typically 20% of the amount of the mortgage.
precious leyva says
September 9 at 2:18 pmMy husband and I are looking to buy our first home, and we are not sure what to expect. I’m glad that you mentioned setting a budget that factors in a down payment and closing costs; that didn’t even cross my mind. Hopefully we can find something that fits a budget as we look at homes for sale.
Callum Palmer says
October 4 at 6:36 pmThis was a great read, particularly the little infographic you included in the article that expands on many home buying stats. In particular, I’m surprised that raising a family is the big reason why people buy homes. I suppose that it does make sense though since you want to make sure your kids have a good place to grow up in.
Theordore Winston says
October 10 at 4:45 pmI’m planning to buy a new house and I think this article is really helpful. Making a list of what we really want for our home to have and to look is nice, setting our standards and priorities straight will be a great help in choosing one and will avoid us from getting confused. Thanks!
lesly says
November 6 at 3:06 amThank you for these tips, actionable, and straight to the point. I believe the hardest part is actually finding a worthy home to buy.
lesly recently posted…HomeRight Paint Sprayer Reviews 2017 – [Series #1]
Ashfaq says
November 17 at 1:32 amI am planning to buy my own home, the information you provide here are really helpful. Thanks for sharing
Ashley Turns says
December 12 at 6:57 pmI really like your suggestion to make a list of what you need and what you want from your home so that you can find a piece of real estate with those factors. My husband and I are planning on buying a new piece of real estate that is closer to his work so it is easier to commute and we are wondering how to go about it. we will definitely be making a list of what we need together before we start looking.
laurel says
December 13 at 5:06 amAbsolutely, my partner and I have changed 3 condos yet. We like the ability to move around and explore new neighborhoods
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Ayoob Kadir says
February 13 at 5:35 amI am going to buy a house in a couple of months. This was a very useful article. I believe its important to set a budget first before starting on the home buying process.http://www.guidejunction.com/9-tips-first-time-home-buyers-dont-consider/
Jay says
April 5 at 5:27 pmI mean, we had our budget, but I almost completely forgot to factor in those other things! How do factor in multiple inspections? How much does one cost? Thanks!
Ridley Fitzgerald says
April 16 at 7:38 pmThanks for the tips for buying a home. I like how you said that they first step is to make sure our credit is up to snuff. We’re hoping to buy a home soon, but I’m not sure if my wife’s credit score is that great. We’ll have to check that soon!
Steph Sadatmand says
August 18 at 5:20 pmMy wife and I are looking to sell our home but never had a clue on how to get it ready to sell. I like what you said about knowing the market so that you can set an appropriate price, that’s something I need to look into. Thank you for sharing!
Philip Pasma says
August 31 at 9:13 amThanks for sharing! Definitely get help from a real estate agent. They know the market and have the experience you just can’t duplicate.
Millie Hue says
October 22 at 9:02 pmIt really helped when you said that we should hire an expert since they can help choose the right loan and property for you. I will share this tip with my sister since she will be buying a luxury home next year. This would help her a lot because she has a limited budget even if she plans to buy an expensive property. She just wanted to reward herself for focusing on her career for five years.
Kristine Pigford says
January 15 at 2:18 amGood one. Very informative. I would say to thank you for sharing this blog. Keep writing.
Alex morgan says
January 30 at 4:16 amWell, I come in that 77% who sought help from a real estate agent – American Property Buyers in Houston, TX came to my aid when I was looking at investing in a new home. They came to me and gave me a pretty good deal.
Alex morgan recently posted…5 TIPS FOR NEW HOME BUYERS
Amelia Warner says
April 24 at 1:23 pmMy husband and I are about to buy our first home, so it is really helpful to get some advice on this. In my opinion, it is incredibly important to look for a good mortgage broker. My husband and I were trying to find our own rates, but it was proving to be quite difficult. I think it would be so nice to have someone that is the middle-man between us and the lenders. That way, we can get some help in finding really good rates and negotiate for us if necessary. I will be sure to take your advice and not rush the process so we are sure we find the rates we really need.
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