Buying a home for the first time can be exciting and daunting at the same time. However, it can be a much easier and quicker process with the help of a real estate professional by your side.
First-Time Home Buyers
Buying a home can be an overwhelming process. From financing to negotiating to closing, there are a lot of moving pieces that can leave home buyers bewildered.
A real estate agent can help guide you through each step of the buying process, offering sound advice along the way. By working with a professional agent who knows the ins and outs of the real estate industry, you’ll not only end up with a great home but also walk away with a great experience.
Benefits of Being a First-Time Homebuyer
Buying a home is still considered a vital aspect of the American dream. As a first-time buyer, you have access to state programs, tax breaks, and federally backed loans if you don’t have the usual minimum down payment—ideally, 20% of the purchase price for a conventional loan—or are a member of a specific group. And you may qualify as a first-time buyer even if you’re not a novice.
Tips for when you're preparing to buy
Questions to Ask Before Home Shopping
Location:
Where do you want to live?
Are there particular neighborhoods or communities you prefer?
Type of Home:
What style of home are you looking for (apartment, condo, townhouse, etc.)?
How many bedrooms and bathrooms do you need?
Specific Room Needs:
Do you need a home office?
Is a bonus room or flex room necessary?
Entertaining:
Do you entertain guests often?
Do you need a home suitable for entertaining?
Outdoor Features:
Do you want a yard, pool, or a home in a guard-gated community?
Saving for a Home
Down Payment:
Down payment requirements vary by mortgage type and lender.
Example: A 3% down payment on a $300,000 home is $9,000.
Use a down payment calculator and set up automatic transfers to save.
Closing Costs:
Typically range from 2% to 5% of the loan amount.
Example: Closing costs on a $300,000 home could be between $5,820 and $14,550.
In a buyer’s market, you might negotiate for the seller to cover some costs.
Move-in Expenses:
Save for immediate home repairs, upgrades, and furnishings after purchase.
Strengthening Your Credit
Credit Reports:
Obtain copies and dispute any errors that could harm your score.
Payment History:
Pay all bills on time and keep credit card balances low.
Credit Cards:
Keep current credit cards open to maintain available credit and avoid lowering your score.
Sticking to Your Budget
Set a Price Range:
Base your price range on your budget to avoid financial stress.
In competitive markets, consider properties below your price limit.
In buyer’s markets, you might view homes slightly above your limit.
Work with Your Agent:
Your real estate agent can suggest a range for your offer.
Home Inspection
Assessment:
A thorough inspection checks the structure and mechanical systems.
Additional Tests:
Standard inspections don’t cover radon, mold, or pests. Ask about additional inspections.
Inspection Access:
Ensure inspectors can access all parts of the house, including the roof and crawl spaces.
Participation:
Attend the inspection to understand the home and ask questions. If you can’t attend, review the report carefully and clarify any concerns.
The Bottom Line
Searching for your dream home can be a long, time-consuming process, but working with a professional team will make it more efficient. Proper preparation, budgeting, and understanding of the home buying process are key to finding the right home and making a sound investment.
