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Steps to Take in the Home Buying Process

September 4, 2023  |  Design Tips, Steps to Take in the Home Buying Process, Things To Do

Before you seriously begin your search for one of the new homes in Savage MN, it’s important to have a clear understanding of the mortgage process. While buying a home may seem fairly straightforward – find a home, fall in love, close the deal – there’s a lot more involved, especially when it comes to how you’re going to pay for it. Here are some steps to make sure you’re well-positioned to buy your ideal home.

• Know Your Budget. It’s important not to buy more house than you can afford. Make sure you have a clear list of all of your monthly and yearly payments and compare that with your monthly income to see how much you can afford. Online mortgage calculators can be of some help, but don’t forget to give yourself some room so that there’s money left at the end of each month.
• Mortgage Preapproval. Understand the difference between prequalification and preapproval. Prequalification provides an estimate of your finances and what you can afford, but preapproval has more legitimacy. This is where a lender looks at your financials and says that yes, you can get a loan from them for a set amount. Sellers like the security of preapproval.
• Wants and Needs. Before you start looking at homes, make a list of items that are deal-breakers if they’re not included, and a list of items that  you would like but could potentially live without. This can help narrow down your choices within your budget range and make the choice a little easier.
• Make an Offer. Your real estate agent can help you determine what is a fair market price for the home you want to purchase. If you’re buying a brand new home, you may also be dealing with choosing finishes, so it is important to keep your budget firmly in mind so you don’t go over. Once you have a deal, you can contact your mortgage lender to start the final process, which will include an appraisal to make sure the lender agrees that the home is worth what you’re paying.
• Home Inspection. Even with a brand new home, you should get an independent home inspection to make sure everything functions as it should and there are no obvious construction issues. This is particularly important with pre-owned homes, because there may be issues you wouldn’t be aware of just from looking.
• Underwriting and Closing. All you have to do is have the loan underwriter make last reviews and questions before finalizing the loan. Then at closing, you’ll meet with the sellers, real estate agents, and real estate lawyer to finish the process. This is when the downpayment and all closing costs must be made. After that, the home is all yours!

As you consider purchasing a home, make sure you have a clear understanding of the various terminology relating to mortgages and buying a home. That, along with a clear idea of your budget and finances will help you find your ideal home with fewer unpleasant surprises. Contact us today to learn more about our many brand new homes in Savage MN.

This post was written by Key Land Homes.