buyer-guides

Checklist for First-Time Homebuyers in Kenya

By: PAPIUS MWANGI
January 05, 2023

Buying a home is a big decision and can be a complex and overwhelming process, but with the right preparation and guidance, it can also be a rewarding and exciting experience.

In this article, we'll provide a checklist of things to consider as a first-time homebuyer and explain each step in detail to help you navigate the process with confidence.

Whether you're just starting to think about buying a home in Kenya or you're ready to start looking for properties, this information will be valuable to you as you begin this exciting journey. So, let's get started!

1. Determine your budget.

Determining your budget is an important first step for any homebuyer. Your budget will help determine how much you can afford to spend on a home, which will in turn narrow down your options and help you focus your search on homes that are within your price range.

When determining your budget, consider the following:

Your income: Lenders will typically want to see that your monthly mortgage payments will be less than your gross monthly income.

Your debts: Lenders will also consider your debts when determining how much you can borrow.

Your down payment: The size of your down payment will also affect how much you can borrow and how much you'll need to pay each month.

Closing costs: In addition to the price of the home, you'll also need to budget for closing costs, which can include things like lender fees, appraisals, and title insurance.

2. Get pre-approved for a mortgage.

Pre-approval means that a lender has reviewed your financial information and has determined that you are eligible for a mortgage up to a certain amount.

There are a few key benefits to getting pre-approved for a mortgage:

It helps you determine your budget.

It makes you a more attractive buyer to sellers. Sellers will know that you are a serious and qualified buyer, which can increase your chances of getting your offer accepted.

It can speed up the process of getting a mortgage.

3. Research financing options.

There are a variety of finance options available in Kenya, including bank loans, mortgage financing, and government-backed housing schemes, and it's important to research and compare the different options to find the one that best fits your needs and budget.

Here are a few things to consider when researching financing options:

Interest rates: Compare rates from different lenders.

Fees and closing costs: These can include things like origination fees, appraisal fees, and lender fees.

Repayment terms: Different financing options may have different repayment terms.

Eligibility requirements: Make sure you understand the requirements and whether you meet them before applying for a loan.

4. Start looking for a home.

Once you have a clear idea of your budget and have been pre-approved for a mortgage, you can start looking for homes in your price range. Here are a few things to consider as you begin your search:

Location: Consider a location with close proximity to schools, work, and other amenities that are important to you.

Size and features: Consider the size and features of the home, such as the number of bedrooms and bathrooms, and any special features.

Condition: Think about the condition of the home and whether it will require any repairs or updates.

Future plans: Consider your long-term plans and whether the home will meet your needs in the future. For example, if you plan to start a family.

5. Make an offer.

When you find a home you want to buy, your real estate agent will help you negotiate the price and terms with the seller. Here are a few things to consider when making an offer:

The asking price: Consider the asking price of the home and whether it is within your budget.

Contingencies: Contingencies are conditions that must be met in order for the sale to go through. For example, you may want to include a contingency that the sale is dependent on your ability to secure financing or that the home passes a home inspection.

Closing costs: Closing costs are expenses that are due at the time the sale is completed. These can include things like lender fees, appraisal fees, and title insurance.

Closing date: You'll want to coordinate with the seller and your lender to ensure that the closing date is realistic and allows enough time for any contingencies to be met.

6. Get a home inspection.

It's a good idea to have a professional home inspector check the property for any defects or needed repairs before you complete the purchase of a home.

The home inspector will provide a report detailing any defects or issues they find during the inspection. Make sure you review the report carefully and consider any recommended repairs or updates.

7. Close the deal.

Once all the paperwork is completed and the seller has accepted your offer, you'll need to finalize the purchase by closing the deal and paying any remaining costs.

The closing process will also include the transfer of ownership of the home from the seller to you. Make sure you understand the terms of the title transfer and that you are receiving clear title to the property.

Once the closing is completed, you'll receive a copy of the deed to the property. This is an important document that proves your ownership of the home.

8. Move in and enjoy your new home!

Once the closing is completed, it's time to move in and enjoy your new home! Remember to change the locks for security purposes.

Conclusion

As a first-time homebuyer, you've made a significant and exciting step towards achieving your dream of homeownership.

By following the steps outlined in this checklist, you can navigate the process with confidence and find a home that meets your needs and budget.

While the process of buying a home can be complex and stressful at times, it's important to remember that it's also a major accomplishment and an exciting new chapter in your life. So take a moment to celebrate your hard work and look forward to the many memories and experiences that await you in your new space. Congratulations on becoming a first-time homebuyer! If you have any advice for other first-time home buyers, please leave a comment below.

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