Get ahead in the competitive Spring real estate market by becoming an early bird buyer. While the peak season typically starts in February, we are already seeing more homes hit the market in Northern Colorado. Secure your dream home by following these essential steps.
Before you dive into house hunting, you must analyze your finances and gather the necessary documents for your lender. They’ll need to see your W2s or 1099s, bank statements, proof of current income, copies of tax returns, and brokerage account statements.
Keep an eye on your credit score, too. Avoid activities that may harm your credit score, such as making significant purchases. Big financed purchases, like cars or furniture, can hurt your credit. Be sure to steer clear of those kinds of activities.
Finally, determine a comfortable monthly budget for your new home. The best way to do this is to sit down and create a household budget. I personally like to use YNAB (You Need A Budget) for this. It can help you get a clear picture of your expenses, savings, and where you can cut costs. Get a free month here.
The next step before looking at homes is chatting with a mortgage lender. You will need to get pre-approved for a mortgage. Having a pre-approval shows sellers that you are a serious buyer and capable of buying a home. Working with a local lender can make a huge difference in your home-buying experience. Be sure to work with someone who will break down all the costs involved with the loan. By doing this, you’ll also get a clear picture of:
- How much house you can afford
- What your down payment requirements are
- What your monthly mortgage payments and closing costs will be
The better your financial picture, the better the rate and loan. It’s that simple. However, most people are approved for more than they want to spend every month, so be sure to understand the correlation between your price point and your monthly payment.
Tell your lender you are interested in understanding what price range to look in based on the monthly payments you feel comfortable with.
Need help finding a trustworthy lender? I can help!
Exploration and Window Shopping
Next step: you need to understand your needs and wants. Take these steps to help you learn what you like and don’t like so you are ready and confident when it comes time for serious house hunting and the rush to make an offer.
- Think hard about your day-to-day life and what you want and need in your home. It helps to make a list of your must-haves (i.e., three bedrooms or a primary suite) and your deal breakers (i.e., no eat-in kitchen or no parking space).
2. Get to know the neighborhoods in which you are considering buying. Go there for your normal activities such as coffee with friends or grocery shopping. Try some local restaurants and see what it’s like there at night. You should even take your kids to the different playgrounds. Your agent can also guide you to other neighborhoods that are more affordable but have the same feel and amenities you are looking for.
3. Start casually visiting open houses to get a sense of pricing for the space, location, and features of homes. Think of this as window shopping, but leave the wallet at home! This will help educate you about the local market and how much of your “wants and needs” are realistic within your budget. View homes for sale online to narrow down your list of wants.
Before you get swept up in the house-hunting process, it’s time to stop and ask yourself some serious questions.
Hopefully, you understand your personal needs and budget at this point, but it’s good to go through some self-reflection to make sure moving forward on a home is right for you at this time.
Is your lifestyle ready for homeownership? Do you plan to be in the area for at least another five years? Is your job stable and income consistent? Do you plan to marry or have children soon that may affect where you live?
It doesn’t hurt to put some feelers out and then realize that you might need to wait another year or so before you are comfortable or ready to put down roots. Having your own timetable is okay, and your agent will understand.
When You’re Ready
If you know you want to buy a home this year, let’s get started before other buyers are out there making offers. Reach out to me so we can make a plan—this is an essential step BEFORE going out to see homes. Especially if you also need to sell a home, it’s important to time everything perfectly so you don’t end up with two homes or no homes. It’s never too early to start the planning process, and I’m ready when you are. Email me to get started or schedule a time to meet up here.
I'm Lauren Haug! I'm a teacher-turned-real estate agent, and I teach people how to build wealth through real estate in Northern Colorado.
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