House hunting is one of the most exciting parts of the home buying process. After all, you’re touring homes you might actually live in one day. But at the same time, there’s a lot on the line financially. So you want to go into with the right mindset. Here are some East Bay house-hunting tips to get you started on the right foot.
Top 5 House-Hunting Tips for East Bay Home Shoppers
Research the local real estate market. Review your credit reports for accuracy. Establish a monthly budget for yourself. Be flexible. And get pre-approved for a home loan. That’s our recipe for house hunting success.
Let’s take a closer look at these top tips for East Bay home buyers:
1. Research the current real estate market.
The East Bay housing market has changed dramatically in recent years. Home prices have risen fairly steadily for the last couple of years, and more gains are possible in 2017. With that said, many housing experts have predicted the East Bay housing market could start to cool, at least where home prices are concerned. This is just one of the things you should be aware of when house hunting. Learn more about buying in the East Bay here.
2. Check your credit reports for accuracy.
Your credit reports contain information about how you have borrowed and repaid money in the past. This information is used to produce a three-digit number, which is your credit score. Mortgage lenders use these scores (among other things) to determine whether or not you’re qualified for a loan, and how much interest to charge.
Before you begin your East Bay house-hunting process, review your credit reports to ensure they are accurate. Erroneous information can drag down your credit score, especially when it’s negative information. You can request all three of your reports at www.annualcreditreport.com, the official website for the three reporting agencies.
3. Establish a budget for yourself, before you start house hunting.
How much of a monthly mortgage payment can you take on, without sacrificing your quality of life, savings, etc.? If you don’t have a specific number in mind right now, you’ve got some homework to do.
Before talking to mortgage lenders, sit down and review your monthly income and expenses. Come up with a maximum mortgage payment, and try to stay within that range when shopping for a home.
Many financial experts (including the Wall Street Journal) recommend spending no more than 28% of your gross monthly income on housing costs. But you have the final say in this matter. So find out where your financial comfort zone lies, and stay within it.
4. Be flexible, open-minded and realistic.
If you’re about to start house hunting in the East Bay, you probably already have a wish list in mind. That’s great. Knowing what you want and need from a home is an important first step. But it’s also important to understand the difference between wants and needs.
For instance, you might have to go with your second or third-favorite neighborhood to get the square footage you need. Or you might have to buy a smaller, more affordable home to get into your desired neighborhood. These are common compromises for East Bay home buyers. Be flexible. Be open-minded.
Here’s a general rule to keep in mind: If you find a home that checks most of the boxes on your wish list, and it’s within your budget — it’s a contender!
5. Get pre-approved for a mortgage before you shop for a house.
When you apply for a home loan, your lender will review your financial situation to determine whether or not you’re qualified for a loan. They also do this to determine how much you can borrow. When you go through this process before shopping for a home, it’s referred to as pre-approval (beause it happens before you’ve actually found a house).
There are several benefits to being pre-approved. For one thing, it helps you narrow down your home search to the kinds of properties you can actually afford. Additionally, sellers will be more inclined to take you seriously if you have a pre-approval letter in hand. This is especially important in a hot real estate market where sellers may have multiple offers to choose from.
So there you have them, our top five tips for East Bay house hunters and home shoppers. If you found this article helpful, be sure to bookmark our blog. We publish real estate and mortgage news every week, to keep our readers informed.
Need a loan? Bridgepoint Funding has been serving home buyers in the East Bay for many years. We offer a variety of loan products and programs, including FHA, VA, conventional and jumbo. Please contact us with any questions you have about getting a home loan.