Some Tips for the First-Time Home Buyer
Buying your first home can be an intimidating experience. It will probably be the largest purchase and longest commitment of your life. We’ve put together some tips for the first time homebuyer to help make this process a little easier for you:
- Clean up that credit score. Pay off small balances. Then reapply that money to knock out sizeable chunks on larger debts. Bring that debt down and your credit score up. You’re only saving yourself in the long run by doing this vital step.
- Start saving immediately. Down payments can range from as low as 3% (through special 1st time homebuyer programs) up to 20%. Paying less than 20% could also result in overall higher costs and PMI, which would be another gouge in that wallet. Closing costs, move-in expenses, and furniture needs should also be kept in mind as you tuck away those dollars. Also, if you’ve bought a home with a large parcel land, it is possible you’ll soon be shopping for a large riding mower. Keep all these things in mind as you save for your purchase. It is very easy for a first time homebuyer to overlook such things.
- Get prequalified on that home loan through your lender. This will give you a ballpark figure on what you’ll be able to afford in your new home.
- Hire a real estate agent. The grief and headache they can spare you is worth it. Not only skirting the stress factors, they have connections in their network to ensure inspection day goes smoothly. They can barter on your behalf when it comes to agreeing on the purchase price. They also have the “inside scoop” on what’s going on in the area, so if you are looking for a particular lifestyle, they know where you should look.
- Tour homes you can afford. Tour homes and neighborhoods in your budget or home builder. Make a checklist of what you “must have” in your home. Take pictures and notes. Once you’ve seen five houses, you’re going to have a hard time remembering which one was perfect except for the tiny closets, or which one was okay but had the amazing kitchen.
- Get that home inspection done. You could be saving yourself some major headaches and thousands of dollars later if you allow the inspector to do a good once-over on the home. Inspectors check out the infrastructure, electrical, plumbing, faulty fixtures, or sewage issues. They look for any structural problems in the floor joists, walls, and foundation. Think of it as an insurance plan for peace of mind. A first time homebuyer might miss something that could be detrimental later.
- Review neighborhood comps with your agent if you decide to purchase a preowned home. Find out the fair market value of the house. This could give you some leverage when it comes to submitting your offer to the sellers.
- When it comes time to put in your offer, your agent will direct you in any contingencies you may need to list in your offer. However, don’t paint yourself into a corner and risk losing the home you’ve decided should be yours. We’ve found a few suggestions and tips when it’s time to win the bidding war.
- Once your offer is accepted and it’s time to schedule your closing, be sure to bring all required paperwork so that the transaction goes smoothly.
Buying a home can be a lengthy process. Be persistent and patient. When your agent finally hands you those keys to your new home, it will all be worth it. We’ll be waiting for your call to schedule your tour of our homes.