Buying your first home can be so exciting, after all, it is considered a huge milestone in life. There are also some first-time homeowner advantages (we’ll dive into that later). However, it can also be challenging to navigate through the process of making the biggest purchase of your life for the first time. But don’t worry, we’ve put together the most important tips you should consider when preparing to buy your first home so you can get the most out of your purchase.
EVALUATE YOUR FINANCES
Before falling in love with your dream home and starting the home-buying process, it’s always smart to do a serious evaluation of your finances. The purchase and ongoing expenses of a home are a lot more expensive than renting. For example, consider that replacing a roof or air conditioning system could cost many thousands of dollars, possibly unexpectedly. More importantly, consider getting out of debt and saving up for a down payment. A big down payment can dramatically reduce what you owe and also reduce your costs. Being realistic when determining how much you can actually afford to spend on a home is also important to keep in mind. Experts suggest that your home should not cost more than two and a half times your annual salary.
FIND BEST FINANCING OPTIONS & LOAN TYPES
There are many types of different loan types and payment options available when it comes to your mortgage. Get connected with a great lender so you don’t feel overwhelmed by all the loan terms. Many first-time buyers choose to get an FHA loan due to the lower down payment requirements. Veterans can qualify for no down payment loans with a VA loan. Ideally, buyers would choose a 30-year loan for the lower monthly payments but choosing a 15- or 20-year loan might help you get a low interest rate.
FIRST-TIME HOMEOWNER ADVANTAGES
The benefits of qualifying as a first-time homeowner include having access to state programs, tax breaks, and low- or no down payment assistance, grants and more. To be eligible for first-time home buyer loans and benefits, you must show that you haven’t owned your principal residence within the past three years.
ENVISION WHAT FEATURES YOU NEED/WANT
Since buying a home is such a huge financial commitment, you deserve to find a home that fits both your wants and needs as much as possible. Some features to keep in mind when making your list may include size, bathroom and kitchen layout, backyard space, storage space, and more. To get some inspiration when making your list, scan through some real estate websites to get a sense of what features and pricing are most important to you.
HIRE AN EXPERIENCED REAL ESTATE AGENT
It’s very important to find a buyer’s agent who is knowledgeable and experienced, since you’ll need lots of guidance while purchasing your first time. An agent can not only help you find the home of your dreams, but also help you save money when it comes to negotiating, knowing local market conditions and recommending trusted resources. Closing on a home can be complex and an experienced agent will be proactive to help you through the steps of the process that could otherwise be confusing.