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According to the National Association of Realtors, approximately 40% of
all homes are purchased by first-time home-buyers. Others have done it,
and you can do it also.
1. Think Credit. Poor credit will make you a bigger risk in the
lenders eyes, and more risk means higher rates and steeper monthly
mortgage cost. Make a point of paying credit card bills, auto loans,
rent, and other payments on time, all the time, and in full. A good
credit score is important in getting financing.
2. Consider Taxes. When you buy a home, mortgage interest and
property taxes are generally deductible from income taxes. This means
while monthly housing cost may be larger when you own than when you
rent, what you save in taxes can make up some or all of the difference.
For details, speak to a tax professional or contact us for a rent versus
own comparison.
3. Know the Sales Associate's Role. Real estate agents are at the
center of a property transaction. It is important to know what a real
estate professional does, who is represented, and how the system works.
Our professional agents can explain and guide you through the process.
4. Location. Consider what locations will work best for you. Look
at your needs, the needs of your household members, and your preferences
in terms of commuting, shopping, recreation, and other factors that are
important to you.
5. Home Inspection. Plan on getting a home inspection as part of
the offer you make. A professional inspection will help you understand
the condition of the property and the repair bills you may face in the
next few years.
6. Financing. Look into the financing process as soon as
possible. Get pre-approved so that you will know how much you can
borrow, what you can comfortably afford, and get an estimated payment.
Sellers will take you as a serious buyer if they know you are
pre-approved.
7. Save. You will need money for a down payment, closing costs,
moving, and other expenses. Put off trips and luxuries until after you
are in your new home. Do not make other major purchases after you are
pre-qualified until speaking with your loan representative.
8. Financing Options. Examine the different financing options,
which are open to you. Consider FHA, VA, and state-backed programs,
which offer programs with small down payments and liberal qualifying
standards.
9. Look for gifts and grants. According to the National
Association of Realtors, 22 percent of all first time homebuyers receive
gifts from relatives and friends. Some companies offer grants and other
incentives to employees who are buying a first home. Check with your
401k programs or profit sharing program. Some offer loans against vested
interest for home purchases. Community groups may also have programs and
financing in place. The Federal Government offers special financing
programs for teachers and police officers.
10.Timing. Start now, take your time, and ask your agent a lot of
questions. Being a first time buyer may be challenging, but will be
worth the effort when you own your first home.
Many resources are available to you. For other buying tips and financing
information, contact us.
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