Buying a home for the first time can be overwhelming because it’s a HUGE decision. Whether you’re dreaming of picket fences or plentiful palm trees, there are many dollar signs involved.
And, of course, aesthetics aside, your home needs to be right for you: right location, right function, right amenities.
In addition to the pressure that comes with making one of the biggest decisions you’ll ever make, the process is complex and can be quite quizzical if you’ve never gone through it before.
Here are my 5 top tips for first-time home buyers to keep you on track:
Article Author: Matt Dalbey who is a digital marketing maven and CEO of Generation Web. Generation Web is a boutique Internet marketing agency, offering world-class web marketing services tailored to real estate and other industries. Get to know Matt.
If you’ve made the decision to buy a home for the first time, you may be eager to start looking at homes, but fight the urge.
Unless you’re prepared to pay cash, getting prequalified for a mortgage is an essential first step. You don’t want to locate the home of your dreams and then find out you have little to no financial backing for it.
Make Sure You Have Money Saved for a Rainy Day
If you spend all of your savings on your down payment and closing costs, you won’t have any cushioning if say you lose your job or your house needs major help like roof repairs.
Make sure you have a safety net by leaving as much money in your savings as possible. Financial aid can help with this.
Seek Financial Assistance
There’s no getting around it, buying a home is a hefty expense. But as a first-time homebuyer, you have an advantage.
It’s highly likely you’ll be able to get some kind of financial assistance, so it’s worth taking the time research your options.
From grants and government tax breaks to down payment assistance programs and homeownership vouchers, there are quite a bit of funding opportunities available. And according to Housing Wire, 87% of properties qualify for down payment assistance.
Consider ALL the Costs of Your Home
Beyond a mortgage, there are other costs that come with owning a home, and it’s important not to overlook them. Before budgeting for your first home, research and carefully assess each potential cost.
Here are some of the costs you may incur as a first-time home buyer:
- Down payment
- Closing costs
- Appraisal fee
- Home inspection
- Homeowner’s association fees, $0 – $300 a month
- Property insurance, price varies by location
- Private mortgage insurance, if your down payment is below 20%
You also want to keep in mind that property insurance and taxes typically increase each year.
Have a Home Buying Check List
When you’re ready to search for your dream home, you want to make sure you don’t let your emotions side-swipe your better judgment.
While a house with a charming facade, the marble countertops you’ve always wanted, and a gorgeous avocado tree in the back yard may lure you right in, if it’s a half hour away from your child’s school, is lacking in storage, and has a teeny-tiny yard, it may not truly be the right fit (especially if you have pets and a large family).
Although home-buying is an emotional process, you want to stay as objective as you possibly can, and a check-off list helps you do that.
Put all your must-haves on the list and try to check off as many as possible. This will keep you well focused.
Remember, no house is ever going to be perfect, but if you have most of your must-haves, you probably have a winner.