You’ve decided to buy your first home. This is one of the most exciting times of your life. Don’t let the lack of knowledge about the home buying process steal your joy and add stress. Read these handy tips for first time home buyers that will direct you down the path to home buying success.
Tip 1 – Check Your Credit Report
The lender will check your credit report to learn more about your spending habits and your ability to repay the home mortgage loan. For this reason, you want your credit report to paint a positive picture that makes it easier for you to be approved for the loan. Get a copy of your credit report from all three of the major credit agencies through the Fair Credit Reporting Act. Once a year, you can receive these reports without paying a fee. Remember to get all three because each agency may report different information.
Tip 2 – Put Money in the Bank
It’s common practice to need a home mortgage loan to purchase a property. Not many people can afford to pay cash up front. Still, you will need to pay some fees and costs out-of-pocket. Expect to pay around 20-percent of the selling price as a down payment and between 2-8 percent of the selling price for closing costs. There are times when a seller agrees to pay the closing costs, but you should be prepared to pay them yourself. Closing costs are fees for appraisals, inspections, and other services during the home buying process. One of the most useful tips for first time home buyers is to start saving money early.
Tip 3 – Find a Real Estate Agent
Trying to proceed without the help of a real estate agent can cost you money and cause delays. A real estate professional will be with you every step of the home buying process, keeping you from wandering into danger areas that could cause you unnecessary stress. They have the knowledge and experience you need to have a successful transaction. Find a real estate agent that meets your expectations for communication. They should be experts about the local community and have strong negotiation skills. Your home will be one of the largest investments in your life, don’t trust this experience to just anyone.
Tip 4 – Get Pre-Approved
Don’t use guesswork to search for your dream home. Know exactly how much house you can afford to keep disappointment at bay. Apply for a home mortgage loan pre-approval early in the process. This pre-approval will tell you exactly how much house you can afford. This saves you time by allowing you to focus only on homes within your targeted price range. A pre-approval can tip the scales in your favor if your offer comes up against competition. This approval shows the seller that you are serious about the purchase and can afford to follow through with the transaction.
Tip 5 – Make a Wish List
One of the most useful tips for first time home buyers is to knowing exactly what you want and need. Searching for homes without a definite idea of what you’re looking for can waste time and set you up for failure. Know the style of home that appeals to you, the number of bedrooms you need, and the proximity you expect when it comes to work or entertainment. Place a mark beside items that you consider non-negotiable. It’s rare for a home to have every single item on your wish list, so you’ll want to know which items you are willing to let go. Give this list to your real estate agent. The list will help them narrow down the homes for you to tour and save you valuable time.
You are well on your way to success is you use these tips for first time home buyers. The best source of information about local communities and real estate topics is your real estate agent. Give Joshua or Kelly Norber of the Norber Real Estate Group a call today at 248-785-3737 to learn more about the area, discuss selling your house, or tour available homes for sale.