Buying a home is an exciting, yet stressful process. You’re making one of the largest purchases you’ll ever make, and you want to ensure you’re going about things the right way. For first time home buyers, this may seem even more difficult, since you aren’t exactly familiar with the process and everything that comes with it. Additionally, depending on your state, the buying process may vary, to it’s important to be aware of any local differences. Generally, however, there are a few good tips to consider when buying your first home:
Enquire About Your Mortgage Options
As a first time home buyer, your mortgage options are one of the most important parts of your entire buying process. Your mortgage loan determines the type of home you can afford (price wise), and how long you’ll be paying for it, depending on the amount of your down payment. Keep in mind, your downpayment affects how much you need to borrow in your mortgage loan, so the more you have in your down payment, the better. However, for first time home buyers, down payments requirements also differ sometimes from that of someone who’s owned a home before. Either way, find out what option works best for you, and work on your mortgage from there.
Start Saving Early
To ensure you have a solid down payment, you definitely want to start saving as early as possible. Whether you’re putting down a “traditional” down payment of 20%, or taking advantage of a first time home buyer program, with a down payment as little as 3%, you will likely need a nice lump sum saved to cover the downpayment and closing costs. Keep in mind, even with a 5% down payment, if you’re purchasing a $200,000 home, your downpayment will need to be around $10,000.00, and that doesn’t include closing costs or any other cost for renovations and home improvements.
Remain Within Budget
Before you even start looking, you want to establish your budget, and be diligent about remaining within budget when you start the actual process of looking for homes. It can be very easy to see a home that’s out of the budget and fall in love with it. To avoid that, and other stress, make sure you inform your realtor of what your budget is and stay within that window.
House hunting is exciting! Use some of these tips for the easiest and best experience.