Buying the first home is a major decision in someone’s life, and also a difficult one. Sure enough, you will have some friends aside, always ready to offer advice, but you’ll need expert’s opinion as well.
First-Time Homebuyer Tips
Before sharing your decision to buy a home with friends and family and contacting a real estate agent, take a look at the following 10 tips for first-time homebuyer that we have gathered for you.
1. Decide what you want
The property hunting process becomes lengthy and exhausting when you don’t know what you want and constantly have to choose between apples and oranges. By understanding your needs and preferences, you’ll be able to narrow your search area and not oscillate anymore between totally different properties, such as condos and single-family homes.
2. Estimate your budget
Defining the exact segment of houses that are suitable for you is crucial, and one more thing you can do to delimit your search area is knowing how much you can afford. You can find out how much you can spend on your monthly mortgage by analyzing your monthly budget.
After considering all your monthly expenses, including the snack you buy everyday while going to work, see how much you have left for the mortgage. Also take into account any extra money you will be spending in your new home, such as higher utility bills, insurance, taxes, or redecoration expenses.
3. What does your ideal home look like?
Many people need to be extremely thrifty when it comes to buying a home, but don’t think only about limitations. This will probably be one of the most important purchases in your life, and you don’t want to regret it.
Don’t settle for a house just because it fits your price range and dare to choose the kind of neighborhood you like and opt for a kitchen with high-quality appliances.
4. Don’t focus just on sales prices
One of the most common mistakes that first-time homebuyer make is comparing a property’s sales price to other homes they have seen. Sellers can ask for any price, but this doesn’t necessarily mean the home will be sold for that price.
This is where a reliable real estate agent can help you by providing comparable sales examples (similar homes that have been sold in the past months).
5. Always do a home inspection
It’s easy to oversee flaws when you’re feeling very enthusiastic about becoming a home owner. It’s best to hire a trained professional to inspect your potential new home’s condition and safety.
If the inspection discloses major defects that the seller has not revealed, you can withdraw your offer and get your deposit back. If you really like the house and the flaw is not impossible to fix, you can give a request for repair and the seller should agree to solve the problem.
6. What will be your closing costs?
Moving to your new home may imply some additional costs you never had as a tenant: title and settlement fees, lender origination fees, insurance, and homeowner association fees. Will you still have enough money left to live for the first couple of months after moving in?
7. What are your mortgage options?
It’s recommended to ask for offers from several banks, because each loan comes with different terms and interest rates. Your future plans should also be taken into account – you plan to keep this house for the rest of your life or would you like to buy a larger property as your family expands?
8. Benefit from first-time homebuyer perks
If you are a first-time home buyer, some banks and governmental organizations may offer you benefits such as lower interest rates, advantageous payment assistance programs, and better payment options. Find out if you are eligible for these programs and don’t hesitate to apply!
9. Choose the right real estate agent
Especially when you are inexperienced, you need professional advice and support from someone you can trust. The simplest way to find a real estate agent is asking family and friends about people they have worked with, but you can also check real estate ads and listing signs in the neighborhood, attend open houses, and take a look at online agent listings.
10. Understand what you are signing
Enthusiasm can once again be your greatest enemy when you make a purchase. Most buyers sign a ton of papers in a short time praying that nothing will come up and cancel the deal. The prospect of moving into your new home can get you carried away.
Don’t hurry and ask for a copy of the documents you’ll need to sign. Take your time to read the documents thoroughly and ask for professional help if you don’t understand something.
If you can afford the services of a lawyer during the closing process, don’t hesitate to hire a professional that can translate legal jargon into plain English. Later, you’ll thank yourself for being cautious.
What should I do now?
Are you ready to buy your first home? We can assist you with this process, we know it’s a big decision and we’d like to make sure you make an informed decision.