We will be discussing 6 Tips For First Time Home Buyers and what to consider when you're buying your first home.
#1 Tip For First Time Home Buyers - Get Prequalified
You will need to realize early on how much of a monthly expense you will incur when you become a homeowner. Find a lender you can trust and have them paint a thorough financial picture for you, they will check your credit and see if you qualify for any incentive programs and how much you can qualify for. If you can take it a step further and budget yourself even lower, you'll feel even more financially secure.
#2 Tip For First Time Home Buyers - Keep An Open Mind
Keep an open mind of all that's available on the real estate market. Some people view Foreclosures or Short Sales as Gold mines, however they aren't always a cheaper way to go. The Bank or Lien Holders have already lost money due to the mortgagor falling behind on mortgage payments, so typically it will be sold As Is or with very minimal repairs being done. If the home is in need of TLC you'll need to factor in those costs to determine if it's still a good deal or not.
Also when purchasing a Short Sale it's not short at all, in fact it sometimes takes months till you're able to close escrow and move into your home. Short Sales mean the Lien Holder is selling it Short for what is actually owed.
#3 Tip For First Time Home Buyers - Save Money
Save Money for the down payment, save money for inspections and closing costs, save money for future expenses like furniture and decorating, and of course save money for a rainy day.
Besides money for the down payment you'll also need extra funds towards closing costs. Your mortgage lender can give you estimated closing costs, because they can vary in price from 2%-7% of the homes purchase price.
Other home buyer's expenses include a home inspection or other specialist inspections, appraisal fee, title services and escrow fees.
Many prospective home buyers said that if it meant owning a home in the next 12 months they were willing to make some trade offs. Many said they were willing to eat out only once per week, and limit recreational activities such as going to the spa, shopping or seeing the latest movie.
#4 Tip For First Time Home Buyers - Size Matters
Everybody's circumstances are different and it's a good idea to consider the future. Many homeowners are staying in their homes longer and growing into them. Some are expecting to have a larger family or having a parent or loved one move in. If you are self employed or telecommute, it might be a good idea to also add room for a home office. Before searching for a new home, think of all your space requirements. There's no use looking at 2 bedroom condos when you really need a 4 Bedroom house.
#5 Tip For First Time Home Buyers - Tomorrow is sometimes too late
Tomorrow is sometimes too late in real estate. In our experience, there have been too many times the buyers wanted to discuss writing an offer and sleep on it instead.
In the morning they would ask us to draw up a Purchase agreement, only to find out the seller accepted another offer the night before. Like the saying goes, If you snooze, you lose.
If you really like a house, and it fits all your needs, it's best to let your intentions be known. Your real estate agent can send you comps and let the listing agent know to anticipate another offer. They may decide to wait till yours comes in by the end of the day before making any decisions.
#6 Tip For First Time Home Buyers - Good things come to those that wait
It might take some home buyers a couple months before getting an offer accepted. Most often buyers couldn't find a home at an affordable price or with the desired features. Meanwhile some couldn't find a home in the neighborhood they wanted or their offers were too low and were outbid.
You might need to expand your search area, maybe to the next city over where the commute to work may be 10 minutes longer but the homes are a bit more affordable. You also might need to compromise for a slightly smaller or older home.
Don't worry and don't be discouraged, because the perfect house is out there waiting just for You.
Disclaimer: All information provided is deemed reliable, but is not guaranteed and should be independently verified.