Getting ready to buy your first home can be daunting. But understanding every step of the process and a little preparation can go a long way toward helping to make one of the biggest investments of your life a successful experience.
Are your finances in order? How much house can you afford to buy? Do you understand escrow? Are you aware of closing and insurance costs? What about property taxes and homeowners’ association (HOA) fees?
Making the transition to first-time homeownership may seem overwhelming as you learn various real estate terms, provide proper documentation for financing and navigate the many things needed for the home purchase to be approved. While it’s easy to turn to the internet for answers, some issues won’t be easily resolved without the help of an experienced mortgage broker and real estate professional.
In its most recent 2017 Profile of Home Buyers and Sellers, the National Association of Realtors® (NAR) reported that of the approximately 6 million homes sold in 2017, 34 percent were purchased by first-time buyers. Additionally, 87 percent of buyers bought their home with the assistance of a real estate professional.
If you are considering buying your first home, here are a few points you may want to keep in mind throughout the process:
1. It is important to understand the financial aspects involved in buying a home. For example, you will need to set an honest and realistic budget for an affordable mortgage payment. Compile all the necessary financial documents, including credit reports and scores, save up for a down payment and improve your credit if it is not already rated very good to excellent. According to the 2017 Profile of Home Buyers and Sellers, NAR reports that most buyers paid 10 percent of the purchase price as a down payment and obtained financing for the remaining 90 percent, while first-time buyers typically financed as much as 95 percent of their home. If you’re unsure where to start, a mortgage broker should be able to help.
2. Consider all the costs involved in buying and owning a home, including principal and interest on the loan, taxes, insurance and inspection costs. Also remember to think about future costs like utilities, maintenance, commuting, HOA fees and possible home upgrades.
3. If you don’t understand a term or know what to do next, always consult an expert. I can help you find a property, negotiate the deal and guide you through every step of the home-buying process.
To learn more about how to start planning for your first home purchase, contact me at anytime.