10 Steps to go from a Renter to a Buyer

10 Steps to go from a Renter to a Buyer. Home buying can be scary! Especially if you are living paycheck to paycheck and see no way out of it. Today, I want to share some quick tips on how to go from paying way too much on rent to actually owning your own home.

1. Apply at a mortgage company, this will tell you what you can afford and how much your payments will be. I love using local agents and highly recommend Guild Mortgage. Not only can they help you understand the process but they will give you suggestions on how to bring your score up and what the benefits are.
2. Find a fantastic agent. This is the critical part. Your agent needs to understand and know the market, represent the buyer and make sure the worth of the home is in line with the asking price. Your agent will negotiate a better deal for you and hopefully help you with paying little to no closing cost! This is my specialty!
3. Decide what criteria is most important, unless you are going to build a home, none will have everything you will want so you make a list of the must-haves and go from there.
4. Start the search, your agent will want to set up several homes for you to view, sometimes it only takes one home but most of the time it takes more. Do not feel bad if you don’t find one you like the first time around. Usually, you are excited and nervous and need to see several before making such a big decision.
5. Pick your home. After finding your perfect home, the negotiating begins! This is where it is extremely important to have a good agent! They will handle all of the legal requirements and paperwork and make sure you are being represented for the best deal possible.
6. Once an offer is accepted and under contract, you will give an escrow check. Usually, it is 1% of the sales price so on a $100,000.00 home you are looking at a $1000.00 check.  This will get deposited by the title company and kept until closing at which time it will be deducted from your amount owed. It is like an insurance payment.
7. Then you will have the option to have an inspection and termite inspection done. This will be paid upfront by you the buyer. Depending on the market the average is around $350.00 for inspection and $100.00 for termite inspection.
8. The survey and other fees can and should be negotiated by your agent. I usually ask the seller to cover these. To lessen the amount of cash my buyer needs to have on hand.
9. Closing, at this point you are out $1000.00 plus or minus for escrow, inspections $500.00 plus or minus, and now the closing which is usually 30 days after you have signed the contract. Here you are required to pay whatever percentage the mortgage company decides. Some can pay as little as 1%, all the way up to 20%. You can ask for the best deals but by knowing this ahead of time you can start saving!! If it is only 1% you can purchase a $100,000.00 home for $1,000.00 down. The total cost would be around $2500.00.
10. Welcome home, many people don’t realize their house payment is less than what they rented for!

Owning a home is the American dream. I would love to hear if you are a homeowner and how you saved money in the process!