1. Create a List of Must-Haves, Nice-to-Haves, and Deal Breakers

Start by listing each room you'd like your home to have. Then, write out the features you want for each room as well as the property as a whole. Deal breakers and must-haves make it easy to filter out homes that just won't work, while nice-to-haves can help you decide between final contenders.

2. Map Out the Full Picture of Your Budget

It's not as simple as saving up for a down payment. In addition to the listing price, it's important to assess the hidden costs of buying a home. These costs can add up quickly, so it's crucial to budget for: closing costs, home inspection fees, property taxes, homeowners insurance, maintenance, and moving expenses. Most mortgage lenders also require cash reserves that can be used to help pay for housing expenses if your income stops for any reason.

One of the easiest ways to determine your budget is to have a Loan Officer walk you through the numbers. They can answer any questions you may have and work with you to create a plan based on your goals, income, expenses, and debts. If you’d like a personal consultation with a Cal Coast Loan Officer, you can call 877-495-1600 or send an email to RealEstateLoanOfficer@calcoastcu.org.

3. Don't Rack Up Debt Once You're Pre-Approved

It’s a good idea to get a mortgage Pre-Approval Letter before jumping into home hunting. This goes hand-in-hand with determining your budget as a pre-approval will let you know the exact, maximum loan amount a lender can offer you. It will also signify to a seller that you should be taken seriously. In a competitive market most sellers won’t even consider an offer if the buyer hasn’t been pre-approved.

Generally, pre-approvals are good for 90 days because that’s how long it takes for the credit report to expire. If you have a pre-approval that’s going to expire don’t worry, because it’s usually easy to extend. Be aware that your approval amount can be affected by the following factors:

• If rates go up or down
• If you change the property type that you are looking to buy
• Change to your debt
• Change in your employment

4. Scope Your Local Housing Market

You'll want to think about your future plans. Is the neighborhood likely to increase in value over time? What will your commute look like? Websites like Zillow can help you scope out potential neighborhoods. You can get insights on schools, crime rates, public transit, walkability and, of course, home prices. Feel free to try Cal Coast’s Home Rewards search engine to compare homes in Southern California.

5. Choose the Right Realtor

Buying a home usually involves a ton of negotiation— and the details can get tricky. A realtor can help you get the best possible terms and avoid costly deadlines. When you’re faced with a 10-page purchase agreement written in legal talk you’ll be glad to have a seasoned professional on your side. But be careful! As with any industry there are plenty of subpar real estate agents.

Many agents (even some of the good ones!) require you to sign a contract that locks you into working with them and only them. Before signing anything check the agent’s online reviews and pay close attention to whether they seem to care about getting you into the right home, or just any home.

You can get connected with a local agent via Cal Coast’s Home Rewards program. Click the link directly below and select ENROLL NOW. Once you’ve found a home you like, you'll create an account (takes 30 seconds) and be paired with a trusted agent.

6. Don’t Be Afraid to Submit an Initial Offer, or Multiple Offers at Once

Navigating the real estate world can be scary and there’s a lot of misleading information out there. Oftentimes, new home buyers are told they need to be 100% committed to a purchase before submitting an initial offer. While this may benefit the seller it’s likely not the best advice for first-time homebuyers. In a competitive housing market, you should be prepared to submit multiple offers before getting chosen by a seller to proceed with the sale process.

This is when things get serious. Once a seller accepts your initial offer, you’ll need to pay an earnest money deposit— also known as a “good faith deposit”— to move forward. Usually, you’ll only have a few days to deposit the earnest funds which are typically 1-3% of the total home price. If you choose not to pay the earnest money deposit, you can walk away from the deal without losing any money. If the sale does go through that deposit will go towards your down payment.

7. Do Your Due Diligence Before Paying For a Home Inspection

Before closing the deal on a new home, you should absolutely get a professional home inspection from a highly rated and reputable company. But home inspections can be expensive, and you might save time and money with a little bit of investigative work. Also, there’s factors you should consider that a home inspection will not cover. Here’s a few things to check for:

• Signs of mold or water damage
• An uneven foundation, or large cracks in the driveway or garage
• Cell service
• Gas lines (if you like cooking on a gas stove)
• Traffic during rush hour
• HOA fees and bylaws
• School district (if you have or plan to have kids)
• Sex offenders

Listing agents want to give their clients the best chance of selling their home for the highest price, which can lead to issues getting swept under the rug. It’s your job to bring concerning factors to light so you can make an informed decision. You don’t want any surprises as a new homeowner.

8. Think Outside the Box - Consider Short Sales and Foreclosures

While this option isn’t for everyone, these homes often have highly motivated sellers and can be less expensive than other properties on the market. The catch? Hunting down these opportunities may take some extra work. Also, be prepared for a longer than usual sale process.