In today's digital age, with so much information available at your fingertips, many people wonder if they really need to work with a realtor or if they can buy and/or sell a home on their own.
First Time Homebuyer 101 Planning Basics
Your first home purchase…it’s both exciting and a little overwhelming for some. Not to worry though because our team of experienced realtors has your back!
To help you get the lay of the land, we’ve compiled a list of the basics to help you started down the road towards becoming a first-time homebuyer.
Tip #1: Get Pre-Approved
Before you take off looking for that ‘perfect home’, get pre-approved fist. In today’s market, houses move quickly, so when the time comes that you do find that perfect home, you’ll want to be able to make an offer immediately. Being pre-approved will give you the ability to make an offer with certainty and will help put you at the top of the pack should there be competing offers on the table.
You’ll also want to take time to clean up any credit issues or concerns that might negatively impact your ability to buy a home before you apply for a loan. Dispute and remove any incorrect or non-relevant items from your credit report and get your credit cards and outstanding loans down as far as possible before applying for your first home loan.
Tip #2: Understand Your Finances and Requirements
Having a down-payment and knowing how much house you can truly afford are key before you delve into the home buying process. While it’s true that there are many programs out there that are specifically designed for first-time homebuyers that do not require you to put down 20 percent, odds are, unless you qualify for a VA Loan, you’ll need something to put down. Securely stash away as much as you can comfortably afford to put down 2-3 months prior to applying for your home loan.
Next, sit down and create a home buying budget to discover how much home you can comfortably afford. Be sure your analysis includes things like utilities, insurance, principal payments, and all general living expenses. If you can, check out a homebuyer or financial planning course either online or in your area. In these courses, you’ll be able to get a better understanding of just what you need to budget for specifically and how to best invest and plan for your financial future.
Tip #3: Have a Plan and a Professional Support System
Once you’re ready to start the process, find a realtor that not only has an outstanding reputation but that you connect with on a personal level as well. This person will become someone you become very close to and will rely on heavily throughout this process. You want to ensure you find someone you feel comfortable talking to and who you know will have your best interest at heart.
Outline a plan of what you’re looking for, the areas you are interested in living in, and what your goals are for the next 5-10 years. Share all of this with your realtor so they can help guide you towards a home that meets your wants and needs.
Also, ask questions along the way. Your realtor is there to support you, so take advantage of their knowledge and experience. And listen to them if they raise a flag or spot a possible cause for concern about a house, say perhaps a potential foundation issue --- take their warning to heart. And if you’re unsure, feel free to get a second opinion or inspection.
Tip #4: Do Your Homework
Yes, your real estate agent is the expert, but as with anything in life, you want to come to the table prepared. Do your homework and be proactive!
Check out the neighborhoods you like online and drive around the area on the weekends and in the evenings, so you can get a feel for your potential neighbors, the activity and vibe of the area, the schools, and the overall community.
Tip #5: Be Flexible and Keep an Open Mind
It’s important to have an open mind when you’re looking for your new home, especially for many first-time buyers who are on a budget. Be careful not to soak in too much HGTV and make sure you’re being realistic about what is available in the area that you want to live in, while also staying within your budget.
Many of the cosmetic items you see in a home can be updated or fixed over time, so don’t get hung up on the little things and expect that everything is going to be perfect inside the house. Focus on the structural aspects of the house: roof, foundation, plumbing, windows/doors, etc. Those are the costly items that you’ll want in tip-top shape before considering buying a home…the cosmetic items can be addressed over time.
Tip #6: Plan for the Future
Don’t try and purchase the home you think you’ll retire in, but rather, focus on buying the home you think you’ll need for the next 3-5 years. Make sure it’s big enough for you and your family today and allows you a little room to grow.
My Home Realty, LLC. is based in Southaven, MS. Our company is built on the belief that real estate is about relationships! We are made up of real estate agents and brokers who are focused on th....