First Time Home Buyers Can Use All the Tips They Can Get

Some benefits of owning a home include saving money, improving your security, increasing your net worth, and living the dream. Needless to say, it is unsurprising that a whopping 28 million Americans plan on buying a home in the coming 12 months, as stated in a 2022 NerdWallet survey that the Harris Poll conducted online. However, the process of owning a home can be extremely daunting if one is ill-prepared and doing it for the first time. As such, you need to get everything right to make sure you sail through safely. One of these is planning early to avoid any inconveniences likely to crop up due to being a first-time home buyer. Another is to strengthen your credit score to increase your chances of getting a mortgage. Moreover, you should carry out extensive research to minimize risks associated with buying a home for the first time. More of these tips are explained below to ensure you run into as few problems as possible when purchasing a home for the first time.

1 - Start Saving as Soon as Possible

When saving for a home, you need to have three main costs in mind. The first one is the down payment, which varies depending on the lender and the type of mortgage you have settled on. The second is a closing cost, which is the expense or fee you pay to finalize a mortgage. The third is a move-in expense that caters to home repairs, furnishings, and upgrades.

2 - Ensure You Know Various Mortgage Options

Different mortgages have different eligibility requirements and down payments. In the U.S., there are four main categories of mortgage options, and they include:

• VA loans for current and veteran members of the military service, and they normally do not require down payments.
• USDA loans do not require down payments too, and they are for rural home buyers.
• FHA loans require down payments that can be as low as 3.5%, and they are insured by the Federal Housing Administration.
• Conventional mortgages are not guaranteed by the government and some targeted for first-time homebuyers may require down payments that are as little as 3%.

3 - Find a Good Real Estate Agent

An experienced real estate agent will not only find a home that meets your needs; also, they will help you go through the negotiation process smoothly. To find such a real estate agent, ask recent home buyers for referrals. You can also interview a few agents and make sure they send you their testimonials. During the interview, ask the agents about their experience helping home buyers find ideal homes. Besides, make sure you ask them how they find homes yet to be made available on the market since this can be a crucial skill when the demand for housing is high.

4 - Do Not Go Over the Budget

Going over the budget can leave you with more debts to pay that, eventually, can lower your credit score. However, make sure you stick to your budget no matter what happens. To achieve that, try to curb the pressures that come with spending more to beat an offer placed by another buyer. You should also avoid the temptation of a lender loaning you more than the amount you applied for. Come up with a solid budget and then, with the help of your real estate agent, set a price range based on it.

5 - Try to Negotiate with the Seller

There are different ways to do this, like asking the seller to pay for repairs in advance so you do not spend more on them once the entire process is finalized. Another is to ask the seller to lower the price so you can channel some of the funds to repairs. It is important to note that how hard you drive a bargain depends on the local market. For example, driving a hard bargain is likely to be tough if the number of buyers exceeds the number of homes on sale.

6 - Hire a Home Inspector

A home inspection assesses the mechanical and structural systems of the home you plan to buy. It is important that you hire a professional inspector capable of conducting a thorough assessment to look for potential problems that can be deal breakers. You should also be present during the inspection, so you can follow the inspector around and ask questions while they carry out the inspection. Another thing is to make sure the inspector checks every part of the house, including crawlspaces and the roof.