Buying your first home seems an overwhelming plan to think about. But it doesn’t have to be super tedious when you actually go through it. All you need is proper preparation, and keep few crucial points as guides. These steers you away from regrets and pitfalls, and lets you enjoy a new life in your starter house.
Money is one of your biggest concerns when buying a house. That is why it is important to know the essential financial issues you should prepare before shopping for a property.
- Credit – Be sure you have at least 600 credit scores so you won’t have difficulties in applying for a mortgage. Fix your credits at least six months before making a move, and avoid huge debts such as car loans before closing.
- Mortgage – Talking about home loan always give first time home buyers huge headaches. But it is important to learn as much as you can about it to avoid financial mishaps because of wrong decisions. For example, you should aim for mortgage pre-approval to avoid hassles when you’re already shopping for a property, and for the sellers to see you as a serious buyer that they should prioritize. Talk with your real estate agent for more about mortgage.
- Down Payment –Pay at least 20% of a property’s total cost right on the down payment. This is to avoid bigger worries added over your mortgage, and avoid spending extras for private mortgage insurance. This takes up a huge bulk of your total saving to spend for buying a first home.
- Home Inspection – Hire a professional home inspector to check a property before you pay for it. This helps you avoid buying a property with lots of hidden problems. Yes, a professional home inspector may cost few hundred bucks.However, they’re worth paying for since they gears you away from unexpected expenses.
- Closing Costs –The closing day is when you’d seal a deal with the seller, and you’d finally get the keys of a property. Thing is, you need to pay for some fees during the event, such as loan origination fees, title searches and insurance, and survey taxes among others.
- Regular Living Expenses –Of course, you should prepare for the cost living in your starter home. Think of monthly mortgage payments, utility bills and maintenance expenses you should shoulder, but you’d possibly need to add homeowners association fees among other charges depending on where you live. Also, value the importance of building an emergency cash saving that should cover around three to six months of your financial needs.
Prepare to Actually Buy a Home
Once your finances are all set, learn the most important points when starting the actual buying process.
- Hire a Real Estate Agent – Yes, you can find a home on your own, but it is still best to have an expert along. Real estate agents know the exact market condition of a certain area, thus they can help in making your way towards the perfect starter home.
- Location, Location, Location! – This is the most important considerations when buying any properties. It should be located in an ideal area for you to live. Say, it should be near your office or school, and should have essential establishments around. The neighborhood must be great for living as well.
- Features of a Home – Of course, purchase a home that suits you well, but it is wise to buy one that can serve you for long years. If you plan to have a family in five years or so, for example, then a one or two-bedroom house may not be perfect for you. Also, avoid buying a home if you only plan to live for it in around two or three years. Consider renting one instead, and save yourself much of the hassles and expenses.
These are only a few of the most important notes that first home buyers like you must keep in mind. But still, remember that talking with a professional real estate agent is still the best reminder that could help you.
Image Source: Freepik
Call me today and have my teamwork for you. You will be thankful that you did!
Your Realtor for LIFE
Do you want your home selling experience to be made easy?
Ed Constable is a top Realtor in Fenton, MI, and surrounding areas!