Are you ready to buy a home? Century 21 Tri-Cities is here to help! Whether it’s your first time or your tenth, our Realtors® are here to make the process smooth and easy. You can start planning ahead today with our step-by-step guide to the home-buying process, or check in as you go so you always know what’s next. Read on to learn more, and get started by contacting a Century 21 Tri-Cities agent today!
1. Check Your Credit
The first step you should take before making any big purchase is checking your credit. You can get a free credit report every year, and your score will give you a better idea of what kind of loans you’ll be eligible for. Credit scores range between 350 and 850, and the higher your score, the better loan you can get. The best loans are typically available to those who have a credit score of 720 or higher, so if you’re taking this step early and planning ahead, you may be able to take action and raise your score for a better loan.
2. Determine Your Budget
Next, it’s time to decide how much you can afford to spend on a house. There are plenty of mortgage calculators online that can help you with this! It’s important to keep in mind not only the monthly mortgage payment you’ll be responsible for, but also any mortgage insurance payments, property taxes, and the potential costs of ongoing maintenance. You don’t want to be surprised by how much it costs to own a home after you’ve already signed the papers.
One reason to do this before you talk to a lender is because many banks will approve you for a higher loan than you’ll realistically want to pay. Before you’re tempted by what they have to offer or all the big beautiful homes on the market, do the math and know what is reasonable for you. As a general rule, you likely won’t want to buy a home that costs more than five times your annual income.
Don’t forget about the down payment and closing costs! You may be able to afford the monthly mortgage payments easily enough, but you’ll need several thousand dollars on top of that to close the deal at the start. If you haven’t started saving up to cover these costs, now is the time!
3. Talk to a Lender
We recommend getting pre-approved for a loan before you start looking for a home, because this will give you more negotiating power if you find something you like and end up in a competition with other bidders. Pre-approval will also give you the near-final say on what you can spend on your future home, regardless of what your budget says.
Pre-approval means the lender will pull your credit information to get a better idea of your financial situation. They may also ask for paperwork like bank statements and pay stubs. If you are pre-approved, you will receive a letter from the lender that you can use to prove to any sellers that you are ready and able to buy.
Getting pre-approval from one lender does not mean you have to choose them for your final loan. Talk to at least three banks so you can compare fees and rates. They should all be able to give you an itemized breakdown of any loan they would offer you and any associated fees, such as the cost of an appraisal, so you can decide what works best for your situation.
4. Find a Real Estate Agent
Buying a home is a long, complex, time-consuming process. Having an expert by your side can make it that much less stressful. A real estate agent will work by your side and on your behalf, leveraging their expertise to help you find the perfect home for the best price and giving you as much or as little support as you need. They have in-depth knowledge of the local housing market, and they can access information not available to the public on available homes and their specifics. Trust us — you want a Realtor® on your side!
Explore our blog for more tips on how to find the right real estate agent and understanding the difference between agents, brokers, and Realtors®. When you’re ready to find the right fit, contact a few Century 21 Tri-Cities agents and talk about what you’re looking for in a Realtor®!
5. Decide What You Want in a Home
Before you jump into looking for your perfect home, you need to decide what your perfect home is like. What do you need in a home? What do you want in a home? What aspects of your future property are you willing to be flexible on?
Share with your real estate agent what you’re looking for and be specific so they can help you narrow down the possibilities more quickly. Give them an idea of your price range, the geographic area you’re interested in living in, and your top priorities when it comes to the house or the property. It will make your home search much easier if you start with a clear idea of what you want.
6. Look Around
Now it’s time to shop for a new home! This is one step in which your real estate agent will come in handy. They can go through available real estate listings for you to find properties that match your criteria, and they may be able to connect you with options you can’t find on the public market. Keep in mind that your list of needs and wants for your future home may evolve as you see new places — visiting properties will help you better determine what you like, love, or hate about each place and give you a chance to adjust what you’re looking for.
7. Make an Offer
Congratulations, you’ve found a home you love! Now it’s time to make an offer. Again, your real estate agent will be key in helping you through this step. A property’s listing price is only a starting point, and your agent’s knowledge and experience will be essential to crafting an effective offer. When you hear back from the seller, you may get a simple “yes” or “no,” or you may receive a counteroffer that your agent can help handle.
8. Schedule a Home Inspection
If a seller accepts your offer, then it’s time for a home inspection. The person selling the home should already have looked over the property to make sure there are no major issues, but a home inspection is expected in most cases, if not required. Your real estate agent can help you with this step as well — they should be in contact with several reliable home inspectors.
If the inspector is willing, go with them as they examine your potential new home. This is a valuable opportunity to understand the ins and outs of the property and see for yourself any problems that should be fixed. The inspector will send their final report to both you and the seller, and in many cases, you will be able to negotiate repairs or upgrades as a condition of closing on the home. If you do ask the seller to perform repairs, make sure you do a final walkthrough of the house to confirm what was done before signing the paperwork and taking responsibility.
9. Set up Insurance and Utilities
You’re in the home stretch — it’s time to consider insurance and utilities. If you already own a home, you may simply be able to contact your insurer and have them write a new policy for your new address. If you have been renting, then you will need to find a homeowners policy that works for you. (Homeowners insurance is required!) You’ll also want to contact your utilities company to make sure your home will be ready for residents on or before the date you plan to move in.
This is it! You’re ready to take ownership of your new home. This step can be long and arduous, with a lot of paperwork to read and sign, and it’s another moment when you’ll want a real estate agent by your side. They’ll help you navigate all the documents to ensure they are in your best interest, and they may need to negotiate a few final points. Then, you’ll receive the title and the keys. Congratulations, homeowner!
Buying a home is an exciting but complicated process. Having a real estate agent by your side whom you trust is key to a good experience. If you’re ready to move within Pasco or the wider Tri-Cities area, find your Realtor® with Century 21 Tri-Cities! We look forward to working with you.