Whether you are relocating to California from out of state or are a local, the process of buying a home in California is certainly not for the faint of heart. The Golden State presents many obstacles for the home buyer, including an incredibly competitive real estate market and state restrictions on how much money and what percentage of income you can spend on housing. The search for the perfect home might be over, but the road to ownership has just begun. There are several steps you must take for it to become your new home.
Evaluate How Healthy Your Budget Is
By answering the following questions, you can determine if you will likely be approved for a mortgage in California to get one of the desired homes for sale in California. Do you have two years of employment history or other verifiable proof of income? Is your credit score above 620, and can you pay off any past-due or excessive debt, if necessary? Have you consistently paid your rent or mortgage in the previous year? If you responded yes to every question, it’s safe to assume that you have sufficient funds to make a purchase. If you answered no, you might want to improve your credit and financial situation before house hunting.
Get Pre-Approved for a Mortgage
Multiple offers are commonplace in many California real estate markets, especially the San Francisco Bay Area and coastal communities. Potential homebuyers can get an edge by making competitive cash offers, making several bids, and making large down payments or earnest money deposits. Pre-approval from a lender stating that your financial situation (credit, income, and assets) is sufficient to qualify for a mortgage will also be useful. Pre-approval from a lender shows a seller that you are serious about purchasing a home and have already begun the loan approval process. Even while it is possible to get pre-approved by a single lender before beginning your house search, real estate agents typically advise their clients to get pre-approved by many lenders to ensure they receive the most favorable conditions.
Ways to Find a Home
A real estate agent or broker can be chosen at the outset of the home-buying process or through preliminary conversations with other candidates. Realtors that are part of the California Association of Realtors are the ones who list the vast majority of homes in the state. To find a real estate agent, you can either visit a real estate brokerage in the area you’re interested in or conduct your search online through several real estate websites that feature individual agents. There is no shortage of real estate agents available at open houses or while driving by the listed property. Dual agency occurs when a buyer uses the same agent who initially drew their attention to the home because of the “for sale” sign on the property. Agents acting as dual agents serve the interests of both the seller and the buyer.
Making Offers and Getting One Accepted
You can either get lucky on the first house you put an offer on, or you end up spending a lot of time and energy house-hunting before you finally find the right one. The success rate varies widely from buyer to buyer and housing market to housing market. Bidding on various properties may not be a problem if you are not in a rush to make a purchase. But if you’re in a hurry to move into your new home before the kids start school, you may have to offer less favorable terms or bid higher to beat the competition.
Attend Inspections
Your offer includes a house inspection as a contingency, so you could learn more about its condition by participating in the home inspection. If everything looks good after reviewing the report, your agent will let the seller know they can move through with the transaction. If maintenance is required, discussions about who will carry it out will follow.
Get your Utility and Insurance Accounts in Order
You still have some work to do. To get a mortgage, your lender will require you to have homeowner’s insurance. This safeguards the capital they’ve put up. Homeowner’s insurance can cover the loss of a home even if the mortgage is paid off in full. Remember to contact the utility companies and arrange to have the accounts transferred into your name once service begins.
Get the Keys to Your New Home
The home buying process requires patience, effort, and above all else, persistence. And the day of closing can be both stressful and satisfying. At the closing table, you and the seller may come face to face to sign a mountain of paperwork. When the seller is kind, everything goes smoothly; however, when they are hostile, tensions build. If you let the experience break you, if you give in to anxiety or frustration, you’ll miss out on some of the joys that come with buying your new home. Don’t let stress take over; instead, be empowered by this process and know that, at the end of it all, you’ll have a new home—one that’s completely yours.
Conclusion
The home buying process can be an exciting and exhilarating example of “tough love.” But don’t let this opportunity break you because, at the end of it all, you’ll have keys to your new home.
Read more: Steps to Sell a House
