Elēt Realty was started to provide a home for independent agents to grow their brand in the real estate industry. Our vision and focus is to help our agents become successful in the real estate industry through broker support, training and lead generation.
Scott Gray, Partner and Broker has 25 years in selling Commercial real estate and Lynn Nichols has spent the last 30 years selling financial services and residential real estate.
Elēt Realty is a membership flat-fee based real estate company. The agent keeps the majority of commissions earned on their business.
Home Buyers Report
Where to start when buying a house
Some of the first things to consider when you are buying a home are how much you want to spend, where you would like to live and what is important to you as a buyer. Here a few questions to ask yourself:
- How much house can I afford?
- Am I going to take out a loan?
- How much do I have saved for a down payment?
- Can I afford my desired neighborhood?
- Are home values increasing or decreasing in the neighborhood?
- How long will my commute take?
- Is the school district a fit for my family?
- Is it within walking distance to amenities and activities?
Once you have the answers to these questions nailed down, you can start your home search.
Here are the 10 most important steps to take when buying a house.
Step 1: Check your credit score
Before you permit a lender to check your credit score, you will want to do a thorough review of your own credit report.
What is a credit report? A credit report pulls data from three major credit reporting agencies: TransUnion, Equifax, and Experian. It is the report used to calculate both your FICO score and your Vantage score.
You can get free reports from all three reporting agencies, at least once each year. If you find any errors in your report, dispute them immediately so they can be resolved before you apply for financing.
The higher your credit score, the lower the interest rate you will receive. A credit score of 720 or higher will get you a good interest rate on a conventional loan, Payment history
- Total debt
- Length of credit history
- New credit
- Type of credit
Step 2: Figure out how much house you can afford
When you get pre-approved, your lender will tell you the maximum amount you are able to borrow (we will talk more about the pre-approval process later). But you do not need to wait for the pre-approval to get a general sense of what you can afford.
Prioritize your wish list to fit your budget
Once you have a rough budget in mind, make a list of must-have home features. Your price point will likely dictate the size, location, and amenities of your future home. Here are a few examples of wish list items to consider:
- Number of bedrooms and bathrooms
- Square footage
- Outdoor space
- Preferred location
- Type of home
- Layout, features, and finishes
- School district
- Pet-friendliness
- Work commute
Step 3: Find a real estate agent
Most buyers find it helpful to have a professional real estate agent on their side to guide them through the process. Typically, sellers fund the buyer’s agent commission, which makes using an agent a cost-effective option for buyers.
Here are some areas where a buyer’s agent can help:
- Market insights: identifies home value trends, new developments, buyer demand and overall state of the market
- Offer price determines what a home is worth and recommends a competitive initial offer amount
- Negotiating: knows when to argue for a lower price and how to negotiate contingencies and repairs
- Local familiarity: has insider tips about the neighborhood and area schools
- Professional recommendations: provides referrals for a trusted lender, attorney, contractor, or other vendors
- Experience: simplifies the process by handling hiccups, staying on top of due dates, and overseeing paperwork
Step 4: Get pre-approved
Unless you are buying a home with all cash, getting pre-approved by a lender will give you an official verdict on your home buying budget. To get pre-approved, a lender will calculate your debt-to-income ratio and assess your overall financial health by reviewing your:
- Income statements, like W2s, 1099s, rental income and tax returns
- Assets, like bank statements and retirement accounts
- Debts, including monthly expenses like student loans, credit cards and other mortgages
- Records of bankruptcies and foreclosures
- Current rent, child support payments, alimony payments and any down payment gifts
When you are pre-approved, you will receive a pre-approval letter. Not only does it officially let you know how much you can borrow, but it can come in handy when submitting an offer. A pre-approval letter shows a seller you are serious about buying their home. This is especially important in a hot market when you are likely competing against other offers.
Keep in mind that your debt-to-income ratio will be examined again before closing. Taking on new debt during the loan approval process can limit the total loan amount available to you during financing.
Step 5: Start the home search
Searching available homes online is a great way to start your house-hunting process. According to the Zillow, 88% of buyers use online resources in their home search. When you feel confident about where you want to live, hire an agent to help you through the process. Additionally, your agent can send you listings and schedule showings.
What to look for when touring homes
Once you start visiting homes in person, be sure to consider the home’s “health” so you’ll have an idea of any major challenges that might be coming your way if you decide to make an offer. Ultimately, the inspection will give you an official report on the home’s quality and condition, but while you are touring, keep an eye out for the following:
- Structural defects and cracking
- Water pressure (turn on faucets and shower heads)
- Electrical issues (try the light switches)
- Functionality and heat retention of doors and windows
- Roof and exterior quality
