First Time Home Buyer Tips

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For a first time home buyer, the entire buying process can be scary, intimidating, and all-around nerve-wracking. Our team wants to make sure that you are comfortable throughout the entire process and that you are ready for what is to come as you purchase your first time. Check out the below tips to help navigate the homebuying waters:

Start saving for a down payment early

More often than not, buyers tend to put 20% down when purchasing their first home, but it’s becoming more common for first-time homebuyers to put down as little as 3%. It’s best to start saving now rather than waiting until it’s too late.

Determine how much home you can afford

Before you start looking for your dream home, you need to know what’s actually within your price range. Realtors are great at finding deals for their clients, so be upfront with your budget when you start the homebuying journey.

Explore your down payment and mortgage options

If you’re struggling to come up with a down payment, check out conventional mortgages, federal housing administration loans, or veterans affairs loans.

Research state and local assistance programs

Many states offer assistance programs for first-time homebuyers with benefits such as down payment assistance, closing cost assistance, tax credits, and discounted interest rates.

Buying a home for today instead of tomorrow

It’s easy to look at properties that meet your current needs. If you plan to start or expand your family, it may be preferable to buy a larger home now that you can grow into later.

Check your credit and pause any new activity

When applying for a mortgage loan, your credit will be one of the key factors in whether you’re approved, and it will help determine your interest rate and possibly the loan terms. Make sure to avoid large transactions during the homebuying process!

Get a preapproval letter

You can get prequalified for a mortgage, which simply gives you an estimate of how much we would be willing to lend based on your income and debts.

Hire the right buyer’s agent

You’ll be working closely with your real estate agent, so it’s essential that you find someone you get along with well and that you feel you can trust.

Pick the right type of house and neighborhood

Everybody is different when it comes to picking out the perfect house. Make sure the house you choose has all the essentials for a comfortable living style.

Stick to your budget

Look at properties that cost less than the amount you were approved for. Shopping below your preapproval amount creates some wiggle room for bidding.
*Stick to your budget to avoid a mortgage payment you can’t afford.

Make the most of open houses

When you’re touring homes during open houses, pay close attention to the home’s overall condition, and be aware of any smells, stains, or items in disrepair that may raise concern.

Compare mortgage rates

Our qualified lenders will present you with a variety of options and be able to find the best rate for your financial situation.

Not saving enough for after move-in expenses

Once you’ve saved for your down payment and budgeted for closing costs, you should also set aside a budget to pay for what will go inside the house.

Not budgeting for closing costs

In addition to saving for a down payment, you’ll need to budget for the money required to close your mortgage. Closing costs generally run between 2% and 5% of your loan amount.

Passing up the chance to negotiate

A lot can be up for negotiation in the homebuying process, which can result in major savings. If you’re in the buyer’s market, you may find the seller will bargain with you to get the house off the market.

Not buying adequate homeowners insurance

Before you close on your new house, your lender will require you to buy homeowner’s insurance. Make sure to shop around and compare insurance rates to find the best price.

Not knowing the limits of a home inspection

After your offer is accepted, you’ll pay for a home inspection to examine the property’s condition inside and out, make sure you understand what is included in the inspection and that everything is being thoroughly checked.