5 Tips When Purchasing Your First Home 

Purchasing your first home is an exciting, but sometimes overwhelming experience. From getting pre-approved for a mortgage to finding the right real estate agent, there are many factors that go into making one of the largest purchases of your life. 

It’s important to have a solid down payment saved up before starting your search, as well as to look into first-time buyer programs that provide assistance with down payments and other costs. 

1. Get Pre-Approved for a Mortgage 

First-time homebuyers are often a little overwhelmed by all the steps and tasks involved in buying a house. Getting prequalified for a mortgage is one of the first steps that should be taken and it can give you a good idea about what you can afford to spend on your new home. 

A preapproval letter from a lender includes estimates for your interest rate, loan term, monthly payment, and closing costs. These numbers can change once you find a property and have the loan underwritten, but having this information early will help you determine your price range. 

It also shows sellers that you are a serious buyer. However, you should note that the loan approval is not a guarantee of financing because the actual loan is subject to full underwriting and verification of income, debts, and credit. 

2. Set a Budget 

It’s important to consider your home-buying goals, and how much you can comfortably afford. Then, set a budget that includes the cost of your mortgage, additional housing expenses, and moving costs. 

Make sure to factor in unexpected costs, like maintenance or renovations, as well as increased utilities because homes use a lot more energy than apartments do. It’s also helpful to have enough cash in reserve for surprise expenses. 

A mortgage calculator can help you figure out how much you can afford based on your income, debt, and location. And don’t forget about other associated expenses, such as homeowner’s insurance and property taxes. It’s also a good idea to set up automatic savings payments into an account that earns interest. This can give you an extra boost towards your home-buying goal. There are different ways to set budgets and save money like investing in a home warranty. You can online and educate yourself with sites such as https://www.cinchhomeservices.com/faq-library/-/faq/best-home-warranty-in-illinois  that allow you to read more about home services that can help you budget. 

3. Find a Real Estate Agent 

Real estate agents are invaluable guides through the home-buying process, especially for first-time buyers. They’ll ask questions about what kind of property you want and set up showing appointments. They’ll also be able to give you advice about local rules and regulations. 

Find an agent by asking friends, family and coworkers for recommendations. Also

look online for reviews and disciplinary action. 

A great real estate agent will know about tons of available homes, often even before they hit the market. They’ll also be an expert negotiator and can help you avoid overpaying for your new home. And they’ll explain the mortgage process, including how much you can afford to borrow. And don’t forget to get preapproved for your loan before you start looking! It shows sellers that you’re serious. 

4. Look at Multiple Listings 

If you’re in the market for a new home, chances are your real estate agent has been perusing the multiple listing service (MLS). It’s a database of properties for sale in a particular area. 

Realtors and brokers share the listings in this database with the goal of connecting buyers and sellers. It can be daunting for a first time home buyer to sift through all the property information, but this is where your real estate agent comes in. 

A good agent can also use other databases and will often hear about homes that haven’t been listed yet. These off-market listings are called pocket or quiet listings and can give you an advantage in a competitive housing market. They may be advertised on social media or through postcard mailings to neighbors. 

5. Make an Offer 

Once you’ve found the right home, it’s time to make an offer. This is a big moment, and it’s essential to have a strategy to win the seller over. 

Before making an offer, determine what’s nonnegotiable for you. Whether it’s the number of bedrooms, a garage, or proximity to parks and schools, make a list. 

Your real estate agent can help you find homes that check off all your must-haves, but also give you some leeway for some nice-to-haves. For example, you might want a backyard patio or a pool. 

Be careful not to overdo it with add-ons or demands, as these can turn off a seller. This is especially true in a hot housing market with high demand and low inventory. Instead, focus on making a solid offer that makes sense for you.

Leave a Comment