1. Don’t buy if you can’t stay for a while.
If you can’t commit to remaining in one place for at least a few years, then owning is probably not for you, at least not yet. However, owning a home has its tax advantages (claiming interest) and usually has a return on your money.
2. Start by cleaning up your credit.
Since you most likely will need to get a mortgage to buy a house, you must make sure your credit history is as clean as possible. A few months before you start house hunting, get copies of your credit report. Make sure the facts are correct, and fix any problems you discover.
3. Look for a home you can really afford.
The rule of thumb is that you can buy housing that runs about two-and-one-half times your annual salary. But you’ll do better to use one of many calculators available online to get a better handle on how your income, debts, and expenses affect what you can afford.
4. If you can’t put down the usual 5 percent, you may still qualify for a loan.
There are a variety of public and private lenders who, if you qualify, offer low-interest mortgages that require a down payment as small as 3 percent of the purchase price (FHA, VA, USDA).
5. Buy in a good school district.
In some areas, this advice may apply even if you don’t have school-age children. Reason: When it comes time to sell, you’ll learn that strong school districts are a top priority for many home buyers, thus helping to boost property values.
6. Get professional help.
Even though the Internet gives buyers unprecedented access to home listings, most new buyers (and many more experienced ones) are better off using a professional agent. Look for an exclusive buyer agent, if possible, who will have your interests at heart and can help you with strategies during the bidding process.
7. Choose carefully between points and rate.
When picking a mortgage, you usually have the option of paying additional points — a portion of the interest that you pay at closing — in exchange for a lower interest rate. Your lender will have more information to help you with this decision.
8. Before looking for a home, get pre-approved.
Getting pre-approved will save yourself the grief of looking at houses you can’t afford and put you in a better position to make a serious offer when you do find the right house. Not to be confused with pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history.
9. Do a market analysis before making an offer.
Your opening bid should be based on the sales trend of similar homes in the neighborhood. Your REALTOR can find this information in his/her local MLS data base or access to county records. So before making an offer, sit down with a REALTOR and consider sales of similar homes in the last three to six months.
10. Hire a home inspector.
Your lender will require a home appraisal and usually a termite inspection. But that’s just the bank’s way of determining whether the house is worth the price you’ve agreed to pay and is free from impending damage. A home inspection for a good idea for a buyer. This will reveal any requirements, stuff that may not be up to city codes, and damage. This also works for a seller in preparing their home to sell. However, every home inspector will have their own report and will probably be different. Remember it is up to a buyer to get and pay for a home inspection.