Information on Buying A House In 2023
The home-buying process can be an intimidating venture for first-time homeowners. If you are entering this process for the first time, just know that the housing market is constantly changing–interest rates go up and down, properties come and go, and insurance and homeowners fees steadily increase.
As a first-time home buyer, you might think the first step is looking for available houses in your area, or the area you want to move to. It can be overwhelming to see the price ranges, the square footage, and the different locations these houses have available. However, most people forget—just like any other large purchase in your life–there are steps you can take to ensure the process is handled smoothly and carefully.
What is the Home Buying Process?
The home-buying process includes the following steps:
- Save for a down payment and get pre-qualified for a loan
A good down payment can impact many aspects of the purchase of a home. Additionally, getting pre-qualified for a loan can save you time and money, and give you a solid foundation to start on.
- Find your price range
This can help eliminate the unnecessary options that you might look at when touring the market. On top of that, you want to have a good understanding of what you’ll need in your home (multiple beds and baths, a large kitchen, laundry space, etc.). Creating a list of your top priorities can be helpful for this step.
- Find a real estate agent
A real estate agent/agency helps you narrow down options and find the best possible choices for you and your family. A good agent can help the process run smoothly and increases your chances of finding exactly what you need.
Once you find the house you are looking for, the next step is to have it inspected. This will tell you what could possibly be wrong with the house, if it would need significant repairs, or if it is safe enough to live in.
- Final Walk-Through/Closure
The final step is a walk-through of the house before you officially buy it. Once everything is in order and you have gone over the steps above, you can close in your new home!
Being Financially Prepared
The process of buying a home is more than just purchasing one. Often, people forget to consider, what you might call, side investments. These are the additional fees, payments, and actions that you need to understand before buying a house. Here are a few financial aspects to consider during the home-buying process.
Down payments are typically a percentage of the house you want to buy–the amount is set by the mortgage type that you choose. You can decide, however, how much to put down on your down payment. A bigger down payment might be anywhere from 15-20%, whereas a small one could be from 5-10% of the original cost. Keep in mind, a large down payment has the benefit of paying off your mortgage faster and helps to decrease the interest.
The interest rate on a mortgage depends on the loan type, credit history, and down payment size. According to the Mortgage Reports, interest rate predictions for 2023 could vary from 5% to 9% for the 30-year fixed rate.
Your credit score has a large impact on the loan type as well as the interest added when you are buying a house. Lenders assess the risk there could be in relation to your score. Maintaining a good credit score allows the lender to see that you would be able to make your payments successfully.
If you need more information on credit scores, Lacasa offers the Mater Your Credit class to help raise your score and gain control again!
A buyer’s fee is the amount of money a real estate agent or agency will receive as a part of the transaction for the house. This fee should be taken into consideration when budgeting for a home–it can range from 2% to 3% depending on the agency you choose.
Master Homeownership Class
We know buying a home can be a difficult venture on your own–we want to help you overcome any obstacles. The Master Homeownership class provides a step-by-step guide to the home-buying process, as well as a course by a HUD-certified instructor. Sign up for the Master Homeownership today!