We are living through challenging times that will one day be found in history books throughout the world. In Michigan, the Stay at Home Order was just lifted on June 1st. This order caused non-essential workers to be home more then ever before and many are realizing their current space is too small, their layout is not functional, there is not enough storage, they are sick of paying their landlord or listening to their neighbors through paper-thin walls to name a few complaints. So, why not use this extra time to look at buying a house that will bring some joy back to being at home?
There is no better time to start looking at options for purchasing a new home, but is it possible to buy a home right now?
Some general facts you need to know before getting started in the home buying process during the COVID-19 outbreak:
- You must be willing to embrace technology.
- Mortgage Lenders are considered essential and are closing mortgage loans every week for purchases as well as refinances.
- Every individual situation must be evaluated as there is not a one-size-fits-all option.
- It is OK to get started by creating a home buying plan, but NOT purchase right away if you are uncomfortable with current conditions. Your safety and confidence are of utmost concern when purchasing a home.
Scroll through these slides for three easy steps on how to buy a home during COVID-19 safely and confidently.
When planning to purchase a home you must have a clear understanding of where you are starting from. Some important things you need to know:
What is your mortgage credit score? This is the #1 thing because once you know where your mortgage credit is at you can make changes if needed to improve that could result in a better interest rate. It is important that you understand your mortgage credit score is not the same as the scores you may see online or that your credit card company may provide.
How much are you comfortable spending monthly on a mortgage payment? This is important because you may be able to afford a larger loan amount on paper, BUT it is important that you are comfortable making that minimum payment every month.
Think about where you would like to live that would make you happy, be convenient, what type of home that would be, etc. Write down your must haves, wants and dreams.
There are numerous mortgage options and many variables to review that may make one option better for you over another. When reviewing what mortgage best fits your personal situation these are some of the questions to take into consideration:
How much are you planning to put down toward a home? There are mortgage options with as little as zero down, but many find that they are better suited for 3% or more down on a home.
If you have owned a home before? There are some mortgage options for first time home buyers. In many situations if it has been at least three years since you have owned a home you can be considered a first time home buyer.
Where you would like to live? There are mortgage programs that are location specific. For example, a USDA (Rural Development) mortgage is specifically for homes located in rural areas.
What type of a home you would like? There are mortgage loans that are better suited for different home types. For example, one loan maybe best for a multiple unit home but another for a condo.
How long you plan to live in the home? You maybe buying your starter home, moving up to a larger home to better fit your family, downsizing or buying your forever home. There are mortgage options best fit for each of these long-term financial plans. Long-term financial goals should always be evaluated when purchasing a house as your home will be your largest asset.
After you have discusses your options with us you will have a completed Home Buying Plan and are ready to start working with a Realtor. Your Realtor will ensure you are receiving notifications of homes that fit what you are looking for, but most importantly looking out for your best interest and preparing a solid purchase contract. At this step you will also upload any requested documentation through our secure portal so once you find your home we can move quickly.
There is no rush through this step, you want to be prepared and ready to act. At this moment there are some great opportunities as the homes that are being listed have sellers who are serious about selling. There are also fewer buyers actively looking if they do not have to move or are not serious to find their next home. This has made the current environment less competitive for home buyers, though there are still situations with multiple offers.
- If you do not have a Realtor that has already been referred to you to, we have some of the best in the Michigan to refer you to.
- As of November 18th Open Houses have been postponed, private scheduled showings are available with only the Realtor and immediate household members in attendance. Everyone is to wear masks and keep a 6ft social distance.
As of June 2nd Realtors are able to hold Open Houses, but must follow enclosed public space restrictions: Masks will be required, limited number of people in the home at a time, 6-feet social distancing and most will request that nothing be touched while walking through. As of May 7th Realtors are available to provide private home showings by appointment with a maximum of four people on the property at once, you MUST be pre-approved for financing or have proof of funds for a cash offer and follow all CDC guidelines.
- You can easily view homes with photos, virtual tours and even live zoom meetings with homeowners walking you and your Realtor through the house.
- All Real Estate & Mortgage documents can easily be signed electronically and needed documentation can be uploaded to your loan file as a PDF or even taking a photo with your smart phone!
- You can still have a home inspection.
- Homes are still appraised by licensed appraisers, so you know the value of your home.
- There are multiple options for closing on your new home, all of which have required precautions in place to ensure everyone’s safety.