Buying a home for the first time can be quite daunting that you might consider just going with the first house you’d like or just go back and rent. When you decide to go on this path, it shouldn’t be taken lightly since it’s a quite a big deal – after all, it’s one of the largest purchases you’ll ever make. You don’t need to rush into home ownership even if it’s a sign of being a financially responsible adult. This is a huge commitment plus it involves a lot of work.
It is also important that you know what you’re getting into and be prepared with as much information as you can so that you can understand the current real estate market – it’s actually better when you know more. So here are the things that first time home buyers need to know so that the process can be a bit easier when you go through purchasing a home:
Know how much you can afford.
It is essential that as a first time home buyer that you should have an idea of how much money you can borrow for your home purchase and how much you can shell out for monthly payments along with other miscellaneous expenses that comes with owning a home. To be able to pay for your first home, you’ll need a good credit score, a stable job and cash for downpayment.
Get pre-approved rather than getting pre-qualified.
This can be quite confusing especially for first time homebuyers but what you really need is to get pre-approved since more information is checked and you’ll have a better idea how much you can afford. Also, when you are pre-approved, you’ll be in a better position to negotiate with the seller as they will see that your offer is solid.
Consider financing options and know your credit score first.
As a first time home buyer, you should obtain a copy of your credit report and check for any errors. Even if you believe that you are making payments on time, it’s always best to make sure. Any errors found do take time to fix and repair. This means that your home purchasing can be put on hold until everything is cleared out. Also, it’s possible for first time home buyers to have bad credit mortgages. You can have this worked out and still get a mortgage to buy your home.
Prepare to make an offer.
Once you find the home that you’d like to purchase, your real estate agent should assist you in deciding how much you will offer for the house along with the conditions you will ask for. Your agent will present the offer to the seller or the seller’s agent and the seller will either accept the offer or will do a counter-offer until you reach a deal or decide to not push through.
Get a home inspection.
Before you close the deal on your home, make sure that you obtain a home inspection so that you won’t have to do a lot of unexpected repairs on your end. Once the property has been cleared, you can work out a deal with the seller and close the offer. However if you do find any significant damage during the home inspection that the seller did not disclose, you should negotiate to have the seller make the repairs or consider other options.
Don’t take chances and research as much as you can when you go on this journey of purchasing your own home.
Do you have any other tips you’d like to share to first time home buyers?
Join our newsletter
If you like Critical Financial, subscribe and get our latest content via email.