Buyers Advice For First Timers
Buying your first home is an exciting time in your life, but the process can also be daunting. First-time buyers are likely to run into a lot of terms they’ve never heard before in every step of the process, like escrow and closing costs and earnest money deposit.
It’s a good idea to arm yourself with a bit of knowledge before you buy a home, especially if it’s your first time.
Here’s what first-time home buyers should know about the home-buying process, along with questions you can ask your real estate agent to help you become more comfortable with the buying process.
Pre-approval will make everything easier
Even if you don’t yet own a home, you probably know that a mortgage is a specialized type of loan just for buying houses. Mortgages are available through banks, credit unions, and other lending institutions, and there are even companies called mortgage lenders that focus on nothing but mortgages.
The first step of the home buying process should be to decide where you will get your pre-approved home mortgage from, whether it’s through your own bank or credit union, or a specialty lender. You should do this before you start looking at home listings because you’ll want to get a pre-approval letter from your lender of choice.
A pre-approval letter states that based on your credit history and income, a lender is willing to grant you a mortgage for up to a certain purchase price.
Getting a pre-approval letter will not only help you determine how much home you can comfortably afford but will also help speed up the home buying process by demonstrating to sellers that you have guaranteed financing for your big purchase.
Don’t settle for the first home you can afford
Depending on the amount you can finance through your lender, chances are there will be several home choices in your price range available. It’s always a good idea to shop around when you’re buying a house, especially for the first time.
Keep in mind that even if a particular home is slightly out of your price range, you may be able to get the seller to come down on the purchase price.
Working with a professional local Realtor gives you an advantage here because they will advocate for you with the person who’s trying to sell a home and help you reach the best possible buying price.
For best results, work with an agent
The home buying process can be very confusing for first-time home buyers, and the big numbers that are thrown around while you’re looking at homes can be daunting.
Many people think that they can save money or time by going through the home buying process alone, without the assistance of an experienced real estate agent.
Working with a local Realtor will actually save you both time and money, while ensuring that you understand every step of the process. One common mistake among first-time home buyers is the misunderstanding that you have to pay a Realtor to help you buy a home.
In fact, most “Buyer’s Agent” Realtors are paid by the seller of the home, and are therefore of no-cost to you. This means working with a Realtor can only benefit your wallet.
Realtors do much more than show homes and collect commissions. As a buyer’s advocate, they will help handle all the paperwork between the lender, the seller, and the buyer, making sure that you understand all contracts and applications required in the home buying process and communicating information between the involved parties in a timely fashion.
Realtors also deal with purchasing offers and counter-offers, help you negotiate a fair purchase price for the home, and work with the seller’s agent to schedule signings, inspections, and other requirements in the complex home buying process. In fact, most first-time home buyers can’t afford to be without an agent on their side.
By working with real estate professionals, getting your mortgage pre-approved, and weighing all the options available to you, you’ll find yourself enjoying your new life as a homeowner before you know it.