Four Most Important Things to Know Before Shopping for A House

Buying a new home is one of the most important things people can do. Home ownership is a great way to build equity and create wealth over the long term. But it’s important to buy a home the right way.

Before you start looking at homes for sale in Nanaimo there are four important things you should know:

#1. Understand contracts and financing

Buying a new home involves a lot of paperwork, so let’s get that out of the way first.

It’s important to get multiple quotes from different lenders, because some are more creative than others. Be sure to check for errors on your credit report and review different down payment and interest rate scenarios to understand the effect on your monthly mortgage payment.

A contract to buy a home is a legally binding document that specifies the purchase price and closing date, and contains contingencies for buyer approval of inspections, and also addresses what happens if the home doesn’t appraise or financing isn’t approved.

Being clear on the terms and conditions of the purchase contract up front also makes it easier to negotiate with a seller. That’s because even though “standard” contracts are used, items can always be changed as long as all parties agree.

#2. Think of tomorrow (and today)

Buying a home is a long-term commitment, and not just in terms of the mortgage. For example, if you’re planning on starting a new job, getting married, or having children, you may quickly outgrow the house you buy for today much sooner than you think. So, it pays to think and plan ahead.

On the other hand, don’t let the power of wishful thinking overrule common sense. Buying one of the homes for sale in Nanaimo also means having enough extra money for repairs and updating, household emergencies that may arise, while still having the extra fund to live your life the way you like.

Many lenders suggest budgeting about 30% of your gross income for monthly mortgage payments, taxes and insurance. In today’s housing market that can be tough to do, so don’t hesitate to ask your real estate agent for lender referrals and buying strategies that can help make your new home more affordable.

#3. Choose the right Realtor

A lot of home buyers choose their real estate agent the wrong way. They decide to work with a friend or family member. Or, they select an agent who agrees to cut their commission, which usually leads to a reduced level of service and problems during the transaction.

In most markets the seller pays the commission and the agents involved in the sale agree to a commission split. So, as the buyer, there’s no financial incentive in selecting a discount real estate agent.

There are several things you can do to choose the right Realtor. Start by interviewing different agents to learn how active they are in the market and how many buyers they are currently working with. Ask them to explain the buying process from start to finish, and last but not least ask your Realtor for client referrals.

#4. Ask if you have to buy

Although there are plenty of good reasons for owning your home in Nanaimo, the fact is that buying a house isn’t right for everyone.

For example, even with today’s low interest rates, the monthly payment may be more than you can afford. Sometimes, buyers make the mistake of buying a home before they have enough money saved. They can afford the down payment, but don’t have enough money left over for updating and decorating.

The direction the estate market is moving in can also help you decide whether now is the right time to buy. Talking with your real estate agent can give you a good idea of what the current and future prospects for the housing market are, and help you decide if buying a home in Nanaimo is the right move for you.