Home Buying Process: A Comprehensive Guide to buying or renting property in Uganda.
Key points
Following a step by step guide can help alleviate the stress and confusion associated with the home buying and renting process.
When taking actionable steps towards purchasing or renting a home, make use of a home buying process checklist for optimal results.
This guide applies most to home buying, but there some picks for renters.
They say business isn’t personal, but it’s personal to us. Especially when it comes to a most crucial decision you will ever make – buying a home.
For many people, owning a home brings a sense of pride and freedom that cannot be matched by renting. When you own your own home, you aren’t bound by a landlord’s rules, and your monthly payments are building equity.
You are about to complete the biggest transaction of your life. Something that must be done right and with care.
Home Buying Process Step By Step
The home buying process can take someone anywhere from just a few weeks to several months, depending on factors affecting inventory, or their level of pickiness or budget, while sometimes it just comes down to luck. For starters, future home owners should kick off the process of buying a home months in advance with the research phase:
Start your research now:
If the possibility of buying a home is on your mind, it’s a good idea to start conducting research early. Reading articles on the home buying process can help you set financial goals, while perusing real estate listings can help you get an idea of what type of property you can afford.
Find out what you can afford:
Once you have a general idea of the type of home you’d like to buy, the next step is figuring out how much house you can afford. Use an interactive mortgage calculator, to get a better idea of what the purchase price, down payment and mortgage payments might look like.
Get pre-approved for a mortgage loan:
Although you can estimate how much house you can afford, a traditional mortgage lender may have a different opinion. By getting pre-approved for a mortgage loan, you will get a definitive answer for how much a financial institution will lend you. For this process, be prepared to submit copies of your financial documents.
Get to know real estate agents:
Enlisting the help of a real estate agent can make your search much easier. 88 percent of all buyers purchase their home through an agent. A good real estate agent will inform you on the home buying process and provide their expertise on local market trends. In addition, they will connect you with listings within your price range that best suit your needs, as well as help negotiate the purchase price.
Find your dream home and make an offer:
You can find for-sale properties through listing websites, local publications and your real estate agent. Start touring homes to develop a sense of what you want and don’t want in your home, as well as what type of inventory is available in your desired neighborhood. Once you find a property that meets your needs, work with your agent to negotiate a fair price with the seller.
Work with your lender:
Next, sit down with your lender and determine the type of mortgage loan that best suits your financial goals. For example, you may be interested in having the lowest possible monthly payment, fixed payments over time, or perhaps a loan best fit for selling the property in just a few years.
Schedule a home appraisal:
After you have been approved for a mortgage loan, your lender will arrange to have a third party company to appraise the value of the property. This process is in the best interest of you and your lender, to ensure that they are providing a loan for a property that has been priced fairly.
Work with a title company:
The home buying process will result in a large stack of legal and financial paperwork. The mortgage lender will usually make arrangements for a title company to manage the paperwork process, through which they will make sure that the seller is the rightful owner of the property.
Close the deal and get the keys:
Once the sale is finally closed and all the purchase paperwork is signed, the property will finally be yours. Once the seller receives the check, you will receive the keys to your new property.
Home Buying Process Checklist
Once you have researched the home buying process in detail, the next phase is to take actionable steps towards your goal of becoming a homeowner. The home buying process is no doubt a long and arduous process, and it is possible that you will experience some setbacks along the way. At times like these, a helpful home buying process checklist will prove to be helpful:
- Know your numbers: Now that you’re ready to buy a house, now is a good time to re-calculate how much house you can afford, using your updated financial information.
- Save up for a down payment: In today’s market, lenders require anywhere from 20 percent in a down payment. If you do not have enough cash saved up, set realistic targets to hit each month until you have saved up enough.
- Do your homework: Make use of the countless resources that offer free information on the home buying process, such as lender requirements, a list of documents to prepare, and how mortgage payments work.
- Interview real estate agents: Purchasing a home is a big, important commitment, and you are entitled to find a great real estate agent. Ask friends, family and coworkers for referrals, and start setting up meetings with agents to identify the one who can best serve your needs.
- Research mortgage types and lenders: Mortgage loans come in all shapes and sizes, as do the lending institutions that provide them. Start your research early so you can identify a lender you can trust.
- Estimate closing costs: It is easy for buyers to forget, or be completely unaware of, closing costs that must be paid at the end of the sale. Home buyers should budget for three to six percent of the purchase price.
