5 Things to Know Before You Start the Home Buying Process
Are you thinking about buying your first home in the Greater Portland area or making a move after a few years? We always recommend these tips when meeting with a client for the first time.
1. Search towns and neighborhoods -Take some time to drive through the towns around Greater Portland. Once you’ve honed in on which towns appeal to you, familiarize yourself with them by going out to dinner at a restaurant, stopping by their grocery store, or visiting town parks. Your world will rotate around where you live so you want to be sure the services and amenities work well for your lifestyle. Another few questions to consider when thinking about which towns to live in: How long will my commute be? Is it accessible to 295/95? What is the distance from Portland?
2. Find a lender and get pre-approved - We can recommend trusted lenders that we have worked with for years. Look at adjustable vs. fixed rate mortgages. You may be able to save money in the long term by going with an adjustable rate. Before visiting homes, it is important to know how much you can and want to spend on a house.
3. Set a budget - Once you’re pre-approved, you’ll have a good idea of how much you can spend on your home. However, this is not necessarily how much you’ll want to spend. It is important to look at your expenses and determine a comfortable amount to spend on a monthly mortgage payment. Your lender can provide you with payment scenarios so you have a good idea what your monthly payment will be for varying price points.
4. Make a list of wants and needs - Do you need a 2-car garage or 3 bedrooms? Make a list of what you desire in your home and, if you’re purchasing with a spouse or partner, be sure to discuss with them so you are both on the same page. It will help streamline the process once you start looking at homes!
5. Set money aside for expenses - When you make an offer, an earnest money deposit is required for the contract, so be sure to have these funds available. Earnest money deposits vary depending on the price of the home and this amount will be applied to the purchase price at closing. Another out-of-pocket expense is the home inspections which are typically $500-600. Be sure to bring your checkbook, as this is a fee the buyer needs to pay on the spot. Additionally, moving is not inexpensive, so whether you plan to hire a moving company or do it yourself, be prepared to have these additional expenses right after you close on your home.