The home buying process can be difficult to navigate without the proper help. The best thing to do would be to keep the following in your mind before you embark on your real estate journey. As a luxury real estate brokerage in New Jersey we want to share with you the 5 vital steps to the home buying process.
The 5 Step Process of Buying a Home in New Jersey
1. Get Pre-approved
Before you look at any potential homes in the area you need to understand the level of tolerance a bank will have with you.Know Where To Go
Getting pre approved for a loan is huge in the home buying process. Knowing where to go to get this done is the start. In New Jersey there are multiple premier lenders. Click here for a list of qualified New Jersey lenders.Income Information
This will include any and all sources of income. Providing all types of income statements such as pay stubs, tax returns and W-2s from two years prior to conducting your search. The potential mortgage officer should give you a good debriefing about what is and is not acceptable.Asset Information
Asset information is likely to come up during the home buying process. In New Jersey home prices are skyrocketing, it is important for the banks to know you are a safe “lend” for them. This can include bank statements, investments, things that you own at the current time.Personal Information
You will need to bring personal identifications as well. This will include your driver’s license, social security number, and any other background information a potential lender would like to collect. Main purpose of providing this personal information during the home buying process is to run a basic background and credit check.Research
The research involved in choosing the correct lender needs to be thorough and well thought out. We recommend looking online before getting sucked into hour long meetings just to find out you already have a better offer. For a basic reference guide to see what type of rate you should be getting, take a look at the chart below. These numbers are from 2018.2. Pick Your Community
This is an important step of the home buying process. From this community selection phase, you will know your price point, neighborhood, tax range, etc. Picking your community prior to the home buying process narrows your search down drastically and will help you find your forever home faster.
Define a Culture
When you start looking for a home the culture of the town is really important. The home buying process in New Jersey can be very different depending on the town. When you are looking at homes in your price range there is a lot that goes into making the final decision other than price. New Jersey is a very diverse state and each county has its own feel to it. Here is what we feel are the defining cultures of the counties we serve.List of New Jersey Counties:
Union County – A place of deep history, from George Washington marching through the fields Union County, to spending the night in the famous Stage house bar in Scotch Plains. The historic and luxury homes in Westfield are incredible as well. The area has a young, innovative and clean feel. A great place to live if you work in New York City.Middlesex County – Middlesex County is home of one of New Jersey’s most iconic landmarks such as Rutgers University. New Jersey’s state school, Rutgers University, recently progressed into the Big 10 Conference which is the most prestigious division of college sports. These advancements in one of the oldest universities in America has caused the culture in Middlesex county to be very progressive. A lot of development is happening in the area due to the forward thinking residents.
Essex County – An area primarily known for its industrial businesses and historical landmarks such as Thomas Edison National Historical Park, Kip’s Castle, and Oakeside Bloomfield Cultural Center. Not to mention, the skyscrapers of Newark and being neighbors with New York City inspire so many.
Spend the time and do your due diligence to figure out where you would best fit in. The culture of the area you are moving into is very important to note during the home buying process.
The towns within your price range all carry a different unique feel and culture behind them. In Union County New Jersey towns are allowed to have their own custom street signs. These small things go to show your towns brand and shape the culture. A popular thing to note is the bumper stickers on the back of people cars. In a town that is rich in culture, you will certainly see different shirts, stickers, logos, and colors associated with the town.
Depending on your particular situation this can be very important to you, or it might not matter.
Predict the Future
The future is hard to predict. Depending on your particular situation you can have an idea, but the most important things to think about regarding the future is the value of the home and living situation.
Value of the Home
People buy a property to call home. Retirement and old age is something that will hopefully happen to all of us. Most people do not take the time to utilize the tools and resources around them to look at the data in markets. Real estate will typically appreciate in value, but by how much? And why? The average consumer needs to consider that a home is most likely the biggest purchase they will ever make, so it is important to consider it an investment and make a smart decision in your ideal neighborhood.
Living Situation
According to a division of NBC News the average American moves 11.4 times in their lifetime. A home buyer typically lives in their home for many years. Your personal situation will change throughout those years.
If you are a young couple, kids might come into play. Forward thinking about your living situation will make the home buying process much easier. In New Jersey, school districts vary drastically from town to town. The more defined you make your search the happier you will be with your purchase. If you are an elderly person buying a home past the age of retirement you have to think of the living costs within the area. The foreseeable future taxes are likely to increase as years go on.
Taxes
Taxes can be a real burden in New Jersey. These taxes have to be taken into consideration when you are buying any type of property. This is a good property tax calculator for anyone interested.
3. Make Your List of Non-Negotiables
Having a list of things you must have will help your REALTOR with your home buying process. The majority of home buyers face the same dilemma. A lot of people do not know what they want. When you are looking to buy a home you must have a sense of direction.If something like a 2 car garage is a must have it, put it on your non-negotiable list. Make a list of the things you need to have in your home, and make a list of the things you can do without. When you are looking for a home these are the things that will jump out at you the most.
It might look something like this:
Must Haves
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4 Bedrooms
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2 Bathrooms
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Front Porch
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Huge Yard
What I Do Not Want
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Stone driveway
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Electric water heater
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A fixer-upper
4. Know Your Timeline
Knowing your timeline will lead to a better home buying experience. The process of buying a home can take a while. To find the dream home you have always been looking for can take even longer. If you know you are 2 years away from buying a home start to know your market now rather than later.
Looking for a piece of property and knowing your area is the best way to notice a good deal. Don’t just take your REALTORS word and have them figure it all out. Most REALTORS are only looking to get paid. If you are not in a rush, do not do jump into anything.
If you do have a deadline, according to homes.com it takes as short as 30 days for some home buyers to finish the entire process. On the other hand, some people can take months just to find a single home they want to make an offer on.
5. Research and Hire a REALTOR
Researching and hiring a REALTOR can be easy, but finding a REALTOR that will be extremely cost effective is difficult. When you are selling a home you want to have the right person on your team. I would recommend the Michelle Pais Group if you are in New Jersey, but there are tons of other great options if you are not in New Jersey.
The home buying process seems overwhelming. If you are interested or have thought about buying a property in New Jersey you should speak to one of our agents to answer any questions you have about the home buying process.
