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Buyers’ guide

happy couple in front of a house

Owning a home is part and parcel of the American dream. In fact, 84% of people say that homeownership is a priority for them.

If you’re ready to have a place you can truly call your own, we’ve prepared these real estate tips for buyers like you:

Get your finances ready

Before you start checking out houses, check if your financial house is in order first. By making sure you’re financially ready for this huge investment, you’ll have a smoother home-buying experience.

  • Set a budget. The 28/36 rule is a good rule of thumb. You should spend no more than 28% of your gross monthly income on housing costs and 36% on total debt payments (e.g. mortgage, car payments, credit card bills, etc.)
  • Improve your credit score. Having a credit score of 700 or higher gets you the best mortgage rates possible and will save you thousands of dollars in the long run. To boost your score, pay all your bills on time and whittle down existing debt.
  • Get pre-approved. A pre-approval letter essentially says how much a bank is willing to lend you if you applied for a mortgage today. It’s crucial because sellers prefer buyers who are already pre-approved for a home loan.
  • Apply for federal perks. Don’t forget about first-time homebuyer programs in Chester County, PA! The Pennsylvania Housing Finance Agency (PHFA) offers down payment and closing cost subsidies for buyers like you.

Hire a real estate agent

You don’t have to hire an agent to buy a home, but given the legal and logistical complexities of purchasing a home, you’ll definitely want to. And that 5% to 6% commission you have to pay? Agent fees are typically baked into a home’s selling price anyway—you may as well hire an agent and make your life easier. Here are some tips on finding the best agent:

  • Ask for their sales record. The most compelling proof agents can offer is their recent sales record. How many homes have they sold in the last three months? How quickly were they able to find a suitable property? How big a discount were they able to negotiate for?
  • Check for rapport. It takes about 54 days to buy a property. Do you really want to spend all that time with an agent you can’t stand or don’t trust?

Start house hunting

With your finances in order and a real estate agent by your side, you’re ready to start the most exciting part of the process: house hunting! To make your journey as smooth as possible, keep these home buying tips in mind:

  • Define your dream house. Your home search will be more efficient if you have a clear idea of what your dream home should be. When listing down home features, clearly delineate which are must-haves and nice-to-haves.
  • Buy for the future. Here’s some crucial real estate advice for buyers: don’t purchase a house for the life you have now. If you plan to have more kids or want to use the house as a retirement residence, make sure the property fits those long-term goals, too.
  • Evaluate the neighborhood. Is the property you’re eyeing located in a good school district? Does it have easy access to shopping centers, business hubs, and transportation depots? Will there be future developments that can increase your home’s value?

Make an offer

Work with your agent to come up with an offer that accurately reflects your chosen home’s value. Exercise caution, though: put in too low a bid and the seller might pass on your offer. Likewise, be ready with a counteroffer if the seller negotiates on the price.

Enter the escrow phase

The escrow phase starts when a seller accepts your offer and you commit to buying their home. This is essentially a due diligence period, during which both the buyer and seller will do their part to uphold their end of the bargain. As the buyer, you have to:

  • Finalize your mortgage application with your lender;
  • Deposit good faith money to the seller worth about 5% of the asking price;
  • Order a title search to ensure that there are no liens against the property;
  • Have the property inspected for potentially deal-breaking flaws; and
  • Get the home appraised to assure your lender that the asking price is fair.

Close on the property

Once both the buyer and seller have tied all the loose ends, all that’s left is to sign the purchase contract. At this point, the house will be officially yours.

Are you ready to take the leap into homeownership? Let RE/MAX Direct be your guide. Our expert team provides the best advice for buying a home, allowing you to make your choice with full confidence. Call us today at 610.430.8100 or email us at remaxdirectwc(at)gmail(dotted)com.