A complete guide to purchasing and selling a home

Sohum Real Estate Agents offer helpful advice on buying and selling homes through articles, videos, and tips. Learn how to buy or sell a home with their help.

A resource for first time buyers

You’re looking to buy your first home and don’t know where to begin? Start understanding home buying basics by visiting the First-Time Home buyer Center on Sohum.

Unable to locate what you're looking for?

By asking a question or making a request, we will respond as soon as possible.

How to Buy a House

Find out about the house buying process and the steps involved in purchasing a house.

How to Buy a House using the 10 stages is outlined in this document.

1.Verify your credit report.

Before researching how to buy a house, you need to check your credit report. This is an important part of any home buying research because your credit score is important and determines if you qualify for a loan, the type of loan, and what interest rate you will receive. When buying a house, you need to have a credit report which shows the current credit score needed to qualify for different home loans. The different mortgage types offered by banks has different requirements. For example, an applicant needs a higher credit score to qualify for a VA loan than an FHA loan. Additionally, USDA loans and Jumbo mortgages require higher credit scores.

It's important to understand that low credit scores are associated with higher interest rates. Most conventional loans require a credit score of at least 620; however, lenders consider new homebuyers with credit scores as high as 700. It's likewise important to keep in mind that the higher your credit score, the lower your interest rate is likely to be. If you find that your credit score is lower than you anticipated, you can research how to increase your credit score quickly so you can start house shopping.

2. Determine how much you can afford.

To determine your budget, you need to first check your credit report. Next, you need to research how much you can afford with a mortgage calculator. A mortgage calculator will give you an estimate of your mortgage payment— which includes the interest, taxes, insurance, HOA and PMI— as well as the principal and cost of each installment. You can find out how much you can afford with a home affordability calculator. Closing costs are another important cost to factor into your budget; they are typically between 2% and 5% of the purchase price.

When determining how much house someone can afford, they must first calculate how much money they have set aside for a down payment. This is typically 20% of the home’s final price. If the buyer wants to pay less than this, they may need to purchase private mortgage insurance (PMI). Some mortgages may require only a partial 20% down payment. In fact, there are little to no down payment home loans out there for those who qualify, such as the VA loan for those that served in the armed forces.

3. Loan pre-approval

Before getting a mortgage, you need to get it pre-approved which tells how much money you can borrow and speeds up the mortgage process involving a lender. It also lets you move faster when you are ready to make an offer on a house. While comparing multiple quotes from different lenders is ideal, making decisions based on the first lender you encounter or your current bank is subpar. Different lenders offer different mortgage terms and rates; so it's imperative to thoroughly research each option before choosing.

4. Search a real estate agent

Prior research is key when selecting an agent. Ask a wide range of questions when choosing an agent to ensure finding the best match for your home buying needs. Subsequently, finding the right agent can help you get the best possible deal on your real estate purchase.

5. Search homes for sale.

To find homes for sale, you must first list your needs in your desired new home. Your wish list is an important part of the process. After you create your list, use it to guide your search for homes in the MLS. Find homes in your desired price range, neighborhood, style, and amenities.

6. Visit an open house and take a home tour

Before you decide on your ideal home, consider attending a home tour, either online or in-person. This will help you find the type of home that suits your personality and needs, and can also help you understand what features you like and do not like. When viewing multiple homes, it can be easy to get confused about the points or features of each one; so, during each visit note down the features such as not to forget those. Also, ask your agent for input and look for helpful ideas.

7. Make an offer.

Once you have found the home you are looking for, it's time to work with your realtor to make an offer. Discuss your bidding strategy with your agent: Is the price fair? What are the features of your offer? Your realtor will know what is best for housing market conditions. When bidding, they take into account your budget and the asking prices of comparable homes in your area to get the attention of sellers.

8. Prepare to negotiate

If you know how to buy a home, you should know that you will most likely receive a counter-offer and need to negotiate with the seller. Your agent will guide you through the negotiation process and decide what the best option is; waive unexpected fees, increase your sum, or total price, or change deadlines. Expect to be able to go back and forth with the seller before agreeing on an offer.

9. Examine the home.

One of the most crucial parts of buying a house is having an inspection done on it by a professional home inspector. By inspecting the house, the professional will identify any structural, electrical, or plumbing issues with it. This will help people negotiate repairs or a lower price when buying a house. Additionally, an inspection will check the exterior, roof, and foundation of the house. If any issues are found during the inspection, negotiating repairs or a lower price is advised.

10. Get the keys.

Once you have completed the property buying process with a transaction, the title is yours. The title company or real estate attorney will close the deal and hand you the keys around 5pm on your closing day. If your home is turnkey, you can often skip minor maintenance and renovations before moving in. You will also want to think about hiring movers, buying new furniture and appliances, setting up your utilities, etc. You will pay for these after the house is yours but may want to factor them into your budget or create a separate post-move budget.