How much home do I qualify for? How much home can I afford? What can I live without in a home? What must I have in my home? How do the local schools rank? Does the neighborhood fit our lifestyle? There are so many questions to ask and answer when buying a home. Enter the home buying checklist.
This new home buying checklist is a list of considerations – both goals and limits – you should take into account before buying new homes in Orlando. The more defined your answers are, the easier it will be for you to find the right kind of property to suit your needs. We don’t answer every question for you but this will get you started.
1. What Resources Do You Value Most?
How many bedrooms do you think you need? Do you prefer living in the heart of the city, or on the outskirts? What must you have and what can’t you live without? We all want the perfect home but ultimately we want the home that best fits our needs and our pocketbook. Would you be willing to settle in a fixer-upper if the price is more affordable? Would you take a home further away from your job, or even in another state, if it meant being able to afford that extra bedroom and a bigger yard? If this is going to be an investment property, look at the neighborhood and assets the same way you would as the type of potential buyer or renter you plan on trying to attract.
Location, access to resources and the types of mortgages you qualify for can also dramatically impact your position in the bidding process. You should ask your real estate agent about the competition in the area. Remember, it never hurts to do some research on your own as well. How many days for sale do properties average in the neighborhood before going under contract? In the last three to four months, what is the average sale price per square foot in the area? This will inform you as to how aggressively you’ll need to make your offers.
2. What Can You Reasonably Afford?
Remember it’s not how much you can afford but how much you can afford and still live comfortably. This means not only taking your mortgage payments into consideration, but insurance, taxes, down payment, repair costs (if any) and other fees. If you need help figuring this out, don’t be afraid to ask an expert for some advice. Many mortgage professionals are happy to give you some insight on the types of loans you qualify for and what your basic costs will be for free.
A loan or mortgage calculator can also be an invaluable tool for figuring this out. Take into consideration that there are different types of mortgages. Some may come with no (or a low) down payment but require mortgage insurance, which will be an additional expense every month.
3. What Kind Of Mortgage Loan Do You Qualify For?
Some loan options make stipulations regarding the size, expense, or location of the property. For example, RHA loans require that you buy in specifically ‘rural’ zoned areas. Moreover, most loans have requirements and limits regarding the loan to value ratio (how much your home is worth vs. the amount of your loan). You’ll want to at least come up with some ballpark figures for your loan limits before looking for properties.
As with Step 2, asking an expert or researching different types of loans can be very important. You need to have a firm understanding of what you amount you qualify for, any and all stipulations, exceptions or additional criteria is involved BEFORE you begin your home search.
4. How Long Do You Plan On Staying In The Home?
Is this a starter home that you will potentially be moving out of in a number of years? Or is this a home you can see yourself staying in for 20 years plus? This isn’t really important for investors, but it can make a huge difference to first time homebuyers. How long you will live here can drastically affect the type of loan option that will best suit your goals.
Once you have a general idea of what you want based on these simple questions, you’re ready to start looking for the right property to suit your needs. But where do you turn now? Where do you begin your search? Do you need an agent now or later (or never)?
The mass of houses available and posted throughout advertisements and media, especially online, is tremendous, and can seem overwhelming at first. Having the right agent can be very helpful. Having the wrong agent, however, can lead to potentially more complications. To find out more about real estate agents and how to find one that will serve your interests, move on to Step 2.