Calling all first time home buyers! The following article is Summit Way Realty’s top first time home buyer tips. Buying your first house is a very exciting experience. But it can also be scary, given that buying a house is quite a big investment. And this is why you need to be careful every step of the way. The last thing you want is to spend a lot of money on a property you wish you never saw. So, avoid disappointment and take the following top tips for first time home buyers to heart.
10 First Time Home Buyer Tips
1. Start Saving With A Goal In Mind
As you already know, purchasing property requires money. Even when the house is relatively small and situated in a less popular neighborhood, the amount you need can still be significant. Hence the reason for saving up as early as possible for the down payment. Right now, a 3 – 5 percent down payment does not sound like much. When you are dealing with numbers over and above $100,000.00, this percentage becomes a great amount and less affordable. Remember, the bigger the down payment, the less you pay on your monthly mortgage.
Keep in mind that you are not just saving for the down payment. There are other costs involved as well, such as the closing costs and overall moving expenses. So, for the first of our first time home buyer tips, remember, the more you can save before buying the property, the better.
2. Establish What You Can Afford
One of the steps to buying a house for the first-time is to establish what you can afford. This is one tip first-time house buyers should take very seriously because too often, calculations are not done properly. For example, only basing your affordability on your current situation is problematic for several reasons. What if you lose your job down the line? Or what if you have to take a job that does not pay as much? What if you get sick, and you cannot work like you used to?
Even though you cannot predict the future, consider the above scenarios, and how they will influence your ability to make payments. Ask those tough questions and make sure you can afford the house you are about to make an offer on. More importantly, ensure you can comfortably make payments without adding to your financial stress.
3. Research Areas And Neighborhoods
The price you pay for a house is determined by several factors, and the surrounding area is one of them. In the first-time home buying process, you need to research neighborhoods before putting in an offer. Two important reasons why research is necessary include investment and living conditions. Is the neighborhood popular and developing? If so, your investment is more likely to grow where it stands.
The second reason is more about living conditions. More specifically, do you like what you see, and how close are you to important locations? Is it critical that you live close to work or schools? At the end of the day, you want to live in a neighborhood where you can be comfortable and enjoy the surroundings.
4. Build Strong Credit
Next, let’s discuss first time home buyer loans. Your credit score will determine whether you qualify for a home loan. The stronger your credit profile, the more you qualify for. Also, credit influences the interest you pay on the loan. There is simply no getting past the importance of tracking your credit while keeping it at a trustworthy level. In other words, pay your bills on time and keep up with financial responsibilities.
5. Always Look At Your Mortgage Options
Just like you wouldn’t spontaneously buy the first available home, why jump the gun when it comes to the mortgage? There are several different options you can entertain depending on your specific situation. Different mortgage options are beneficial because you get to choose between alternative down payment arrangements and the term you pay. Additionally, you can score if you plan on moving into a rural area where a down payment might not be necessary.
6. Consult With A Real Estate Agent
A realtor or agency can be incredibly helpful from the start of your house buying journey. Not only do they have helpful connections, but they are also up to date with important market information. Our team here at Summit Way Realty can help you find your dream home and negotiate the best price. Just provide us with the relevant details and let’s get started!
7. First Time Home Buyer Tips – Get A Preapproval Letter Ready
Do not be surprised if sellers do not take your offer seriously without a mortgage pre-approval letter. A pre-approval letter proves that you already have a lender lined up to finance the purchase. Without it, the seller may be skeptical, seeing as there is no guarantee you will get the necessary funding. If possible, get pre-approval and give sellers a reason to take your offer seriously at the very start.
8. Arrange For A Professional Inspection
Once you find a property, and you are under contract, it is recommended to have a professional inspection. This inspection is done specifically to assess possible problems or issues. For example, is the foundation of the property sinking, and does it require reinforcement? What about the wiring and plumbing system? Are these up to standard, or will you have to do large repairs shortly after moving in? Know what you are buying before you buy it.
9. Utilize Open House Opportunities
Buying a home for the first time can seem daunting and impossible, especially during the unprecedented times we are living in. Due to the COVID-19 pandemic, open houses have been limited. But they are still being arranged, especially through online videos. Instead of having to drive down to the location, you can go online and take a virtual tour of the property, which can help to decide if you need to put in an offer. At Summit Way Realty, our agents can also go look at a house and video chat with clients to show them the house, so they don’t have to get out during COVID-19.
10. Do Not Let Emotions Drain Your Budget
Last, but not least, on our list of first time home buyer tips, is to not let emotions drain your budget. Expect to go through several emotions when shopping for the right house. These emotions are going to influence how objective you stay throughout. It is critical that you do not let your emotions motivate you to buy a property you cannot afford. Stick to your budget and practice self-control while scouting.
When you combine the above first home buyer tips with finding the best realtor, buying a home does not have to be such an overwhelming experience. Even better, buying a home can be enjoyable and life-changing. Make sure you have the best team by your side throughout the process and give Summit Way Realty a call today!
