Buying your first home can be a very exciting experience, but it can also be stressful if you are not prepared. As a first time home buyer, it is important to know what to expect so you can ready yourself for the home buying process. If you're planning on purchasing your first home in the near future, use the following tips:
Always Get Pre-Approved for a Mortgage
Very few first time home buyers can afford to pay for their home with cash, so they must take out a mortgage loan. If you will need a mortgage to pay for your house, it is essential to get pre-approved for a loan before you begin your home search. During the mortgage pre-approval process, you will be required to submit a variety of documents to the lender, such as pay check stubs, bank account statements, and tax returns. Upon being approved, you will know exactly how much the lender is willing to lend you and the interest rate that you will be charged.
Do not confuse being pre-approved for a mortgage with being pre-qualified. These two terms are not interchangeable-- being pre-qualified for a loan means that a lender thinks you are a good candidate for a mortgage loan, but there is no guarantee of an approval.
Be Realistic About Your Budget
When buying your first home, it is a good idea to carefully examine your budget and determine what size mortgage payment you can comfortably pay each month. Just because you are approved for a mortgage loan of a certain amount doesn't mean that you should buy a home at the upper end of your budget. The last thing you want is to be house poor and have very little expendable income after paying household bills and sending in your mortgage payment.
Choose a Real Estate Agent Carefully
As a first time home buyer, one of the best things you can do is find an experienced real estate agent to work with. Your real estate agent will be a very valuable resource, and he or she will be able to answer all of the questions that you are sure to have. Ideally, look for a real estate agent who specializes in working as a buyer's agent—a buyer's agent will understand how to negotiate on your behalf. Take you time and meet with several agents and work with the one who you are most comfortable with.
Share18 August 2016
Once I paid of the mortgage on my house, I decided I wanted to buy an investment property. I had no idea that the buying process would be different, but it really was. There were so many things to consider that I hadn't thought about, and even the loan application process was different. It occurred to me that if I didn't know about it, others likely didn't either. I built this site to help others see what I went through buying my first investment home. I hope that it helps you to approach the process with more confidence and understanding.
