Top 5 Tips For First-Time Home Buyers
These days the real estate market is still super-hot in some areas while cooling off in others.
Among the most attractive and beneficial options to invest money, many consider first-time home ownership, which with proper research and planning can become an attainable goal. What should be considered when buying a home for the first time? To understand your possibilities and treat your expectations, you can use the AI-based investment estimator by Ofirio as it provides you with complete information about the property you are interested in. Now, let’s move on to the essential tips you can make today on your go to homeownership.
1. Make Sure you can Fulfill Mortgage Obligations
The first and most important step is to make sure you are physically and mentally ready to fulfill your mortgage obligations. Indeed, housing in the United States is quite expensive, and not everyone has the necessary amount of money to pay instantly. However, buying the property and giving it for rent can significantly simplify your financial burden. Keep in mind that the mortgage is usually taken for 10-30 years, so this is truly a big commitment. For this purpose, we encourage you to answer the following questions:
- Can I have a stable income throughout the years?
- How much money should I keep in my emergency fund?
- Am I ready to stick to this house/area for more than 10 years?
- Do I know exactly how much money I can spend on the purchase?
- Does my credit history allow taking a mortgage?
Before moving on to the next step, we recommend you apply for mortgage pre-approval. This document gives you a proper understanding of the loan amount you may receive. Naturally, it could be different for you and your neighbor, as it is based solely on your credit score and other financial data. As soon as you receive this letter from your potential lender, you can reach your agent or move to the next step.
2. Make a List of Your Needs and Must-Have Options
Understanding your needs and priorities allows you to immediately exclude options that don’t match your expectations. For example, you are buying an apartment for your underage children, who will probably go to college in a couple of years. Or you purchase a house in the countryside for your elderly parents, who want some peace after their retirement. Thus, in the first case, you may consider a duplex or a cozy studio in the college area, while for the second case it is better to focus on medium-sized houses with several bedrooms. If you are planning to give your property for rent, you should keep in mind your potential tenant preferences and invest in small or medium-sized apartments with a parking place and all the necessary facilities.
3. Hire the Real Estate Agent
A real estate agent is probably the most important person in your plans. Qualified agents will not only simplify the search for the property but also help you to adjust or improve your plan. Quite often, agents help to decide on the offer amount, negotiate with the owner on your behalf, or even submit an offer. They will guide you from the very start of your journey to the closing date, showing you available options and helping with the paperwork. What kind of agent should you trust? The portrait of the reliable agent looks as follows:
- represents a highly-reputable real estate company;
- has numerous positive feedback from the previous clients;
- makes a good impression during the first meeting;
- looks and acts professionally in a line with your requirements;
- explains all the pros and cons of housing, and provides alternatives.
Since your agent will earn a lot on your deal, stick to real professionals who are worth the invested money.
4. Find and Hire an Inspection Representative
A home inspection is an essential part of the deal. The inspector will thoroughly check the house, and give you a clear understanding of the particular problems with your potential property. You can use the report to negotiate with the house owner and ask for a discount. Usually, the inspection results are submitted with the offer. Thus, you can support your discount claim with an expert opinion and strong arguments. Also, such an inspection will help you to evaluate future renovation or repair expenses.
5. Plan Ahead
Even before starting your search and comparing the available options, you should build plans of buying a property in advance. It primarily means working on your credit history, allocating your down payment money, and considering your loan options. According to the US HUD Department, you can qualify as a first-time home buyer and take advantage of the assistance programs if you are a single parent, an individual without any ownership, a displaced homemaker, etc. Besides, you can participate in state loan programs for veterans, members of the Armed Forces, or those who are buying property in suburban or rural areas.
Don’t be disappointed if the process of finding a home takes longer than you expected. Make sure you have properly prepared to start your path to your perfect home. Take your time to inspect the housing for obvious and hidden defects and do not hesitate to ask for the necessary papers or proof of ownership. So, carefully prepare for the homebuying process as such an approach will help you make the best decision!