Familiarity with the HouzMaxx standard 7 step house buying process takes the stress out of buying a house. Knowing the goals of the current activity and what is to follow are well known. A common reference established for all the folks involved in the house buying makes communication easier and meaningful. So we strongly urge you to get familiar with the 7 steps of the house buying process viz.
1. Planning to buy a house
- Strengthen your credit score.
- Figure out what you can afford. Put your budget together.
- Save for down payment, closing costs.
- Build a healthy savings account.
- Find out how much house you can buy. Get a Pre-Approval.
Getting Pre-Approved… The Important First Step
Many home buyers start the home search by viewing homes online, driving neighborhoods and calling real estate agents to ask questions. But before it’s time to start the process of viewing homes, the first step is contacting a mortgage lender to get pre-approved for a home loan. It would be a waste of efforts and also extremely disappointing to find a home you love and then lose out on the home because you needed time to get pre-approved before making an offer.
It costs nothing to get Pre-Approved so contact your bank or local mortgage lender to start the process. A loan officer pulls your credit report, asks questions regarding your employment history and income level and assesses your situation from there. The loan officer will run you through a preliminary underwriting system to determine how much
home you can afford to buy. Once an allowable mortgage payment is determined, the buyer can decide how high of a mortgage payment they are willing to take on. This process lets us know the maximum price range of homes we should be viewing.
There are some great mortgage lenders and loan officers in Kansas City, Johnson County Kansas, Overland Park and the surrounding area and you’ll want to get with one of the best to ensure you have the smoothest possible real estate transaction. Be sure to choose a lender who provides great customer service and who has a history of closing the deals they start. You’ll also want to find a lender who has solid interest rates and reasonable loan costs and your real estate agent can help guide you to a great local lender.
- Find a house you like AND it meets your budget.
7 Things to Do Before House Hunting
First things first: don’t go house shopping without getting a mortgage pre-approval.
Have you found a house online you’re just dying to see? Don’t pull into the driveway until you’ve talked to a mortgage broker first.
There’s nothing worse than putting in an offer on your dream home, only to find out you don’t actually qualify to purchase it. That’s unnecessary frustration not only for you, but for the sellers and realtors as well.
As a former mortgage broker, it was so hard for me to tell someone they didn’t qualify to purchase the listing they had just laid on my desk, but sometimes I had no choice. I felt like a dream killer more than once.
Your credit score in particular is important because only two things determine the interest rate you get on your mortgage: the amount of your down payment and your credit score.
To check your free credit score now visit CafeCredit.com. Its fast and easy!
There’s nothing that will kill a sales contract faster than finding out you can’t qualify to buy a home. If you find out your credit isn’t up to par to buy a home, work on fixing it first, and put your house shopping on hold for a while.
Don’t panic — there will be plenty of homes available once you’re able to start your search again.
2. Make a Budget
You should decide ahead of time what amount you’re comfortable with paying per month for your mortgage. Then go to your bank for your pre-approval letter.
Hopefully you already have a budget and know what will work for you and what won’t, but if you don’t, now is the perfect time to start one. It’s important to do before you have a mortgage payment.
A budget is important because by using one, you’ll always be aware of where your money is going. If you currently use one, then you’ll already have a good idea of how much you can comfortably afford.
Don’t get starry-eyed and blow your budget if your loan officer tells you you’re qualified to purchase a more expensive home. Know your max, and stick to it.
A budget will also help you determine how much you can afford to pay for utilities, furnishings, and decorations for your new home. It’s easy to get carried away with buying new items for your home, but a budget will help you manage these expenses.
3. Find a Diligent Realtor
The next step is finding a realtor who will work for you. You want someone who will stand up for you in the final walk-through or at the closing table if something doesn’t go right.
You also want someone who has lived in the area for a long time, who knows the market, and who is knowledgeable about the costs of home repairs and upgrades.
A good realtor can point out problems with potential homes before you get too attached to them. I appreciated having a realtor who pointed out disadvantages to specific properties, especially as a first-time home buyer without good knowledge of basic home repairs.
The best way to find someone who will work hard for you is to ask for recommendations from friends and family members. (The same rule applies to finding a reputable mortgage broker.) They’re making a lot of money off of you, so they should be in your corner at all times.
I’ve seen many bad realtors and many great realtors, so if your realtor isn’t working for you, find a new one. There’s not a shortage of realtors these days, so make sure you are happy with yours.
4. Make a List of Needs, Must-Haves, and Wants
You may end up seeing so many properties your head will be left spinning. You might forget some of the things you were looking for in the first place.
Before you look at any houses, make a list of your needs, must-haves, and wants. This way, if you get overwhelmed after seeing too many homes, you can simply refer back to your list and remember what it is you’re looking for.
This will also be helpful for your realtor to reference as well.
Making a list of all your wants and needs when it comes to buying a #house is essential!
So many people say that when you walk into the right home, you’ll just know. That certainly isn’t true for everyone, and it wasn’t true for me.
When I first looked at my current home, I appreciated it, but I didn’t get an overwhelming feeling about it.
It actually wasn’t until I slept on it that I realized it would make the perfect house for us. It had everything we needed for our family at a ridiculously affordable price. I didn’t fall head over heels for it at first glance, but now I’m so happy with my choice.
Don’t let anyone tell you it will be love at first sight, because that doesn’t always happen, especially if you’re in the market for a fixer-upper or a foreclosure.
5. Choose Your Location
It’s going to be really hard for your realtor to show you the best housing options for you if you don’t know the area you want to reside in. You’ll end up all over the place if you don’t.
If you aren’t sure about your specific location, spend some time in the areas you’re interested in at different times of the day to get a feel for the area. Good times to visit are rush hour times and nighttime.
Afterward, ask yourself these questions:
- Do I feel safe there?
- Is there an abundance of traffic at rush hour?
- Is it on a busy road?
- Does the neighborhood look clean and well-kept?
Choosing a set location ahead of time will help narrow down the list of properties you see. It will also help you avoid seeing tons of houses that are in a less than desirable location.
6. Save an Emergency Fund
If you don’t have an emergency fund saved yet, buying a house isn’t a wise option.
Houses mean constant maintenance, even if you buy new. You don’t want to be caught without heat in the dead of winter just because you can’t afford to fix your furnace.
You also don’t want to be forced to pay for it on a credit card when you realize you really can’t live without heat.
Don’t put yourself in this position and end up sinking. Save for emergencies.
7. Check Your Emotions at the Door
Buying a house is an emotional process, but do your best to keep your emotions out of it before you make a hasty and unwise decision about a house that’s financially out of your reach.
Buying a house is a business transaction, so play it cool and keep your emotions in check. You’ll be thanking yourself later.
When I bought my first house, I was so set on finding a charming, vintage bungalow, that I let everything else about the house blind me.
I finally found what I thought I wanted, for about $20,000 more than my original budget. The house was a dream, but it was on a really busy main road, and in a less than desirable school district.
It barely had a yard, and our neighbors were practically on top of us on all sides.
I bought the house anyway, and for the next two years, I never went in my front yard. I constantly worried about our privacy, and I kept my blinds closed at all times.
It wasn’t exactly what I had envisioned when I was signing the closing papers on my house.
Luckily, I was able to sell the property two years later, basically breaking even on what I paid for it. I sense the buyers who bought it from me did exactly what I did. They got starry-eyed.
I was lucky to be able to get out from under that house, but many people aren’t so lucky. It was with that house I learned a great lesson the hard way — buying real estate is a business transaction.
Even though it’s hard to keep emotions out of it, you need to in order to keep yourself from making a bad decision that could end up affecting you for years, and cost you a ton of money.
No matter what you do, try to make house hunting a fun process, because it should be. It’s not every day that you get to run around shopping for houses, so try to enjoy it! If you follow this checklist, then your house hunting process will be easy and painless.
2. Sizing how much house to buy
The Twenty-Five Percent Rule.
The most basic guideline is that your house payment should not be more than twenty-five percent of your monthly income. This is the general rule that the mortgage company follows.
Work Out Your Budget Before You Start Shopping
Get your number together for earnings, obligations, savings etc.
Before you start shopping for a new home, work out a budget with a house payment. In addition to the payment you will need to budget for home insurance, taxes and housing repairs. You should set aside a bit of money each month to cover remodeling and home repairs.
What If I Want a Nicer Home?
If you are disappointed with what you can afford, you have three options. The first is that you save up a larger down payment and wait to purchase. The second option is that you buy a starter home or condo and live for five years in this type of home. It takes about five years to break even on purchasing a home. The third option is to buy an older home that you can renovate. Often you can get a fixer upper for less money, but you need to be prepared to deal with the hassles and additional expenses of renovations.
In addition to the down payment, you will need to have money set aside for the closing costs. Your realtor should be able to tell you the estimated amount for the closing costs.
3. Finding a house
4. Negotiating Price & Terms
5. Inspections & Appraisals
10 Top Kansas City Home Inspection Companies
If you are planning to purchase a home, having peace of mind that everything is in good working order is important. One of the best ways to get this peace of mind is by hiring the best Kansas City home inspection company you can find. However, not all Kansas City inspection services are created equal. Here you will find the top 10 Kansas City home inspectors to help make your decision easier.
- Integrity Building Inspections. Owned and operated by a Kansas City couple, Gary has been building and remodeling homes since the 1970s and 1980s. This is a fully licensed and certified company that actively participates in training each year to maintain these. The owner of Integrity Building Inspections also belongs to the International Association of Certified Home Inspectors, which is the largest organization that home inspectors can belong to in the U.S. In addition to home inspection services, the company also offers radon testing services for homes and commercial properties. Learn more at: http://www.kcbuildinginspections.com
- Apex Home Inspections. The home inspector at Apex Home Inspections is a highly trained and experienced graduate of the American Society of Home Inspectors School and also passed the National Home Inspectors Examination. He also receives ongoing training from ASHI to ensure only the highest standards of service are provided. In addition to residential home inspections, Apex offers radon testing for the Kansas City area, as well as nearby locations.Learn more at: http://www.apexhomeinspectorsllc.com
- A-Pro Home Inspection Services. Originally established in 1994, the A-Pro Home Inspection Service has been working to help home buyers have peace of mind with their purchase decisions. Considered one of the top home inspection services in Kansas City, A-Pro offers quality solutions and value, as well as peace of mind. The owner, Todd Turvell is a fully licensed home inspector and holds a number of prestigious certifications, including ASHI, ITI, PHI, and CHI. Learn more at: http://homeinspectionkansascity.org
- Kansas City Home Inspection. Certified in Kansas City, Bill McGuff is the owner of Kansas City Home Inspection. He is one of the most experienced inspectors in the area, with more than 20 years of experience in the residential and commercial home inspection and construction business. The business also belongs to the American Society of Home Inspectors, as well as the Society of Professional Property Inspectors. There is no question that this is a company that takes pride in providing potential home buyers with peace of mind that the investment they are making is sound. Learn more at: http://weinspectkc.com
- Crest Home Inspections. If you are searching for a qualified home inspector in Kansas City, then Crest Home Inspections is the company for you. The inspector here is InterNACHI certified providing a thorough inspection so a home buyer can feel comfortable with the purchase decision they have made. Some of the services offered by this company include home inspection, apartment building inspection, termite inspection services and roof inspection. Learn more at: http://www.kcinspector.com
- Block Home Inspections LLC. Licensed to provide home inspections in the Kansas City area, Block Home Inspections LLC offers more than 14 years of experience in the industry. The company is certified by ICC and a state certified termite and mold inspector. The company is also certified to measure radon and is an EIFS inspector from the Exterior Design Institute. When customers call this service, they can have peace of mind that any and all issues will be discovered prior to completing the purchase. Learn more at: http://www.blockhomeinspections.com
- Premier Inspection Services Inc. As an active member of the American Society of Home Inspectors, ASHI, this company offers comprehensive inspections for homes and commercial properties. Some of the services offered including a camera scope of the entire main sewer line, mold inspections, radon measurements, termite inspections and general home inspections. The company offers a 200 percent satisfaction guarantee and provides each customer with an inspection report after the work is done. Learn more at: http://www.kchomeinspector.com
- Five Star Home Inspections. Serving the Kansas City community for more than 10 years, this is a locally owned and operated company. Each technician is dedicated to providing accurate, honest and professional services to new home buyers throughout the metro area of Kansas City. With more than 5,000 home inspections under his belt, the owner, Mike Blackman is a Certified Member of the American Society Home Inspectors and a graduate of the Midwest Inspectors Institute. Learn more at: http://www.5starinspections.com
- Inspector Nick. The team at Inspector Nick offer a wide array of home inspection services. With several home inspectors on staff, customers can feel confident that their service call will be answered in a timely and efficient manner. Each home inspector has specialized training and certification that is necessary to meet the needs of their residential and commercial customers. With more than 12 years of experience in the industry, customers can have peace of mind when that the inspectors will do their job prior to someone making a purchase. Learn more at: https://www.inspectornick.com
- Bulldog Professional Inspection Services, LLC. The home inspectors at Bulldog Professional Inspection Services offer customers a 100 percent satisfaction guarantee. Each client who calls receives a 1600 item home inspection to ensure that everything is in good working order before they complete the purchase of the home. Serving the Kansas City area for several years, residential and commercial property owners can feel confident that the services offered will exceed expectations. Learn more at: http://www.bulldoginspect.com