Buying a house is an exciting venture that can help you build wealth over time, but getting started can be a complicated process if you’re not prepared. While there are many important factors involved in buying your first home, taking the following steps will help ensure a smooth experience.
What’s Involved in Buying a House?
1. Determine Your Budget
Before you begin house hunting, keep in mind that lenders will be reluctant to approve you for more than you can afford. You also don’t want to put yourself in a bad financial position. So, how much house can you afford? The total sale price of your home should be between three to five times your yearly household income. This includes a traditional 20% down payment and a modest debt versus income ratio.
2. Get Pre-Approved for a Mortgage
While there’s no written rule that says you have to get pre-approved for a mortgage, it does make buying a house easier. Sellers are more likely to negotiate with pre-approved buyers because they have already gone through a preliminary process with a lender. This means there’s a lower chance of getting declined for a loan. When you do find the home of your dreams, having already been pre-approved will help the buying process move along a little faster.
3. Work With a Real Estate Agent
The internet has made it easier for buyers to search for homes without professional help, but there are still many reasons to work with an agent. In addition to doing the searching for you, an agent may know of homes that will soon become available and can point you toward open houses that may be of interest. When you do choose a home, your agent can help guide you through the transaction, ensuring your paperwork is completed and turned in on time. Since an error or missed deadline can sabotage a real estate transaction, this help is invaluable.
EXIT Realty Black Hills helps sellers and buyers connect. They serve communities throughout South Dakota, including Hill City, Box Elder, and Whitewood. After several years in the area, Mike Alley and his team of agents have come to gain intimate knowledge of the local real estate market. This allows the agency to provide the quality service that first-time home buyers can rely on. To learn more about buying a house, visit their website, or call (605) 722-3948 to speak with an agent today at their Deadwood location. To reach someone in Rapid City, call (605) 716-3948.