Buying a Home

5 Things to Do Before You Contract on a New Home

June 4, 2019

We recommend having a checklist of things to research and do in the days and weeks leading up to your home purchase. A few simple steps can help you feel prepared, well-informed and ready to sign that contract with confidence.

1.   Scope out neighborhoods

If you’re moving within the same area of town, researching the neighborhood may not be a necessity. But if you’re relocating between states or even across town, this is a must! When you purchase a home, you’re also buying into the lifestyle of the area, and it’s important you get an accurate feel for the community you may decide to call home. What does that mean? You should take a good old-fashioned Sunday drive. Try out restaurants. See how far you’ll need to travel to the dry cleaner and the grocery store. Do you feel safe? Give your commute a test run. The more info you can find out, the smoother your transition will be.

2.   Get your credit in order

Checking on your credit health is something most finance experts recommend doing yearly, but looking at your reports before you prequalify for a mortgage is essential! Did you know that mistakes on your credit report can lower your score? False information, or even a wrong identity associated with your account, could change how creditors see you and how much you’re able to borrow for a mortgage. To learn more, check out this guide.

3. Set up a budget & get prequalified

A home payment and other living expenses, such as utilities and Homeowner’s Association (HOA) fees, usually account for a significant portion of a homeowner’s monthly budget. Before you fall in love with the perfect home, it’s important to determine what you feel comfortable paying out monthly. Do you take yearly vacations? What is your allowance for clothing and food expenses? Know your numbers! You’ll need to keep your home-related expenses in check so you can afford other needs and any curve balls life throws your way. When you’re ready, contact a loan officer to get prequalified so you know what lenders will be willing to offer. Go here to learn about our affiliate, HomeAmerican Mortgage Corporation.

4.   Tamp down on your spending

You may be eyeing furniture for your new home or planning a vacation before your big move, but you’ll probably want to postpone until after you close on your home. Keeping money in your savings account is important during loan processing. Lenders may see you as less of a risk if you have cash reserves to get you through tough times.

5.   Get on the KonMari bandwagon

Whether you watch the Netflix series or are armed with your own clutter-busting philosophy, doing a purge before you even shop for a new home is a smart idea. Yes, you could wait until the packing starts, but space planning is a huge part of the floor plan selection process. You need to have a grasp on how many belongings you’re truly bringing to your next home. Trust us! Moving into a new home where everything has its place is sure to bring you joy.

Ready to start your home search? Start here.

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