As a first-time homebuyer, you may not have an idea on how the purchasing process works and how to avoid common pitfalls that befall homebuyers. Purchasing a house isn’t just about finding the perfect home and making an offer, that’s just the beginning of a long and complicated process. Here are some of our best tips we have to recommend:
Buying property is expensive and likely, one of the most complex things you will ever do as a person. Be well-prepared and do your homework by attending seminars or meetings that are exclusively for first-time homebuyers. Talk to other home-owners and educate yourself on common pitfalls of the home-buying process. The more you educate yourself the easier it will be for you to sail through the home buying process.
Manage Your Credit
Your credit score is the most important factor in qualifying for a loan. Just because you pay on time every month doesn't guarantee stellar personal credit. The credit you are using, compared to the credit limit available to you, is the story that lenders are most interested in. The lower the ratio of credit used vs. credit available, the higher your score. It can be time-consuming and expensive to repair damaged credit. If you have bad credit, get to making it right; the marketplace offers free credit reports to help you understand your credit score. Review your score prior to approaching home lenders. Ideally, this process should start 3-6 months before you step out to shop for a home.
Regarding the purchase of a home, a lender is going to consider every part of your financial portfolio. Start by getting yourself qualified by a lender to see what price range you can afford without breaking much of a sweat. Once you have your estimate and you are qualified to borrow by a lender, you can spend your time more efficiently by looking for that perfect home within your budget. Keep in mind that the amount you were qualified for does not mean you should necessarily spend that amount.
Make a list of your monthly expenses and ensure you even set a budget for some unexpected homeowner expenses. Many first-time buyers assume that the mortgage payment is the only payment they will be making – homeowner’s insurance, property taxes, higher utility bills including gas, electricity, and water are just the tip of the homeowner expense iceberg.
Finally, check with neighbors, friends and co-workers to figure out which lender they enjoyed working with and also get to know about the process and the steps a first-time home buyer should take.
Get a Professional Realtor
You must enlist in the services of a real estate professional. A real estate professional can help you understand your needs, identify the perfect neighborhood, and educate you in the home-buying process.
Doing your research by going through your real estate agent’s website to fully understand their experience may be the most important step of your home ownership. Read through their reviews and testimonials, from their personal website to their Zillow reviews. Ask your friends and neighbors for referrals and their interactions with their Realtors.
A large and well established real estate firm will ensure a greater access to lenders and other real estate services. A professional real estate agent has the training and know-how to assist you in your purchase of your first home. A seasoned realtor will walk you through the entire home buying process – from educating you on the neighborhoods to helping manage any credit issues, and helping you pre-qualify for a loan.