Advice for First-Time Home Buyers
Buying your first home is stressful. There is a lot of information to consider when looking into buying such as location, mortgages, insurance, and so. However, we’re here to help! This articles, and many others on our blog are here to take some of the stress and mystery out of buying a home.
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If you’re thinking about buying a house, it is important to start doing research on mortgages, and what types of mortgages are best for you and your financial situation. Whether it’s a FRM (Fixed-Rate Mortgage), VRM (Variable Mortgage), HM (Hybrid Mortgage), etc, you’ll want to be familiar with the pros and cons of each and how they may play a role in your home-buying experience.
In order to qualify for a loan sizable enough to purchase a home, you need to have good credit and enough money for a down payment. Good credit scores show lenders that you’ll be able to pay off the mortgage while also helping you with your initial qualification. It can also help in getting you lower mortgage rates and even lowering your homeowners’ insurance rates! Buying a house can take years because you may need some time to save up for the down payment or to raise your credit score, but you should also plan to have additional fees after your actually purchase for things like closing cost, finalizing your mortgage, any immediate repairs the seller didn’t make, upgrades, or any other surprises, just in case.
How do you save for a home when you aren’t even sure how much it will cost? One way is to consider the old mantra “Location, location, location!”. The location of the property and the value of the land that the home sits on is often thought of first when considering the value of a home. However, the location as a neighborhood and the local community, as well as the location of the home on the real estate market (the state and regional values) also play a role in the overall value of a home. These will give you an idea of a down payment, but not an exact number. This is because the cost can change once you put in an offer. It is important to do some research on what kind of home you want and what you’ll likely be able to afford. You’ll want to draft up a budget so you know about how much you’ll need to set aside and how long it will take to get the amount you need. There are often special assistance programs you can utilize that offer things like low-interest-rate mortgages and assistance with your down payment and other costs. Compare mortgage rates and fees, because they are not all created equal, and some lenders offer discounts and other incentives that could help. Once you’ve saved enough and you’re ready to start looking, get a mortgage preapproval letter to show you’ve already begun working with a lender and are serious about buying (not everyone does this and it can give you a distinct advantage and make you look good to sellers).
Buying Your Home
Once you’ve found your new home and explored open houses, prepare for a home inspection. This is to be sure that the house you’re buying is in good condition and to ensure that any issues that should be fixed by the seller are taken care of. It also gives you the opportunity to learn more about your new property and ask any questions you may have. Depending on the inspection and other factors you might be able to negotiate the price with the seller and save money, but in hot markets you also run the risk of losing the sale. However, you deserve to see if there are any significant issues with the house before you commit. Once the house is yours be sure to get homeowners insurance so if anything happens to the home, or your belongings, you won’t completely lose out.
Buying your first home can seem very intimidating, and although the process is complication, millions of people just like you have done it and you’re not alone. All of the work and stress is worth it in the end, and we have all sorts of experts you can talk to while making one of the biggest decisions of your life. We would love to help! Contact us to speak to an expert for more information!