Buying your first home and feeling a little overwhelmed by the process? Don’t! Buying a home in Hawaii really isn’t that hard, especially when you know what to expect and you work with the right agent. Here’s your step-by-step guide to buy your first home on O’ahu.
9 Steps to Buying Your First Home on O’ahu
1. Check Your Credit Report
Before you do anything, take a look at your credit score and report. If your credit is not so great, or you notice any problem areas, consider cleaning them up before you start talking to lenders or agents. The better your credit, the more loan (and lower interest rates) you’ll qualify for.
2. Get Preapproved
Getting preapproved for a loan before you start searching homes can save you a lot of time and headache throughout the process. Getting preapproved can help you determine how much loan you qualify for—and how much home you can actually afford. It also makes you a more competitive and serious buyer whose bid will likely weigh more than an unqualified buyer’s.
Find a lender you like by shopping around or asking for recommendations. Talk to your loan officer about things like income, expenses, and how much you’re comfortable spending monthly on your mortgage. Your officer will ask for documents like pay stubs, bank statements, and tax returns.
3. Find an Agent
It definitely pays to work with a good Buyer’s Agent. And the best part is, you DON’T pay your agent—the seller does. A Buyer’s Agent will represent you and your interests throughout the home buying process, and can give you invaluable advice that stretches from helping you target your location to getting you the best deal during negotiations. Carefully consider and interview agents before signing on with any one agent.
4. Consider Locations
Before you start browsing homes for sale, it definitely benefits you to narrow your search down by location. Consider different cities and communities across the island, considering things like the lifestyles and amenities they provide, as well as their proximity to the places you need and want to be—like work, schools, military bases, or the beach. Consider whether you’re looking for more of an urban atmosphere or someplace where you can have a yard and a little more peace and privacy.
5. Start Searching Homes
Once you know your general location and price point, you can start searching homes for sale in that area. First, determine your needs and wants in a home, considering things like the size and style, the size of the yard, and other features and amenities you’ll need or want.
6. Make an Offer
Once you find The One, it’s time to make an offer. Work with your agent to determine a fair offer price on the home. There may be some negotiations before the offer is accepted—the seller may want to raise the price, but agree to fix or upgrade a feature of the home.
7. Finalize Your Mortgage
Once your offer is accepted, it’s time to decide what type of mortgage you’ll have and who you’ll work with to get the loan. Typically, buyers choose a Fixed-Rate Mortgage with a 20% down payment and a 15 or 30-year contract, but this is far from all that’s available. Adjustable-Rate Mortgages offer more flexible interest rates, and there are many government loan programs available to help buyers with lower credit scores, like FHA loans. Another popular loan type in O’ahu is the VA loan, which provides low-interest low-down payment loans for active duty and veteran service members.
8. Close on Your Home
This is where you’ll pay all your closing costs, finalize all your mortgage paperwork, decide on move-out and move-in dates, and (finally!) get your keys. Be sure to discuss closing costs with your lender—these can include fees for title, appraisal, attorney, inspection, and of course, your down payment.
9. Move in at Last!
Ready to Buy Your First Home on O’ahu?
If you’re ready, then so are we! Team up with RE/MAX Honolulu to learn more about buying a home on O’ahu, explore the island, discover its communities, and find your dream home on the island. Give us a call today.