4 Tips for First-Time Homebuyers
While buying your first home can be both exciting and scary, the good news is that it doesn’t have to be overwhelming. With just a bit of preparation, you can ensure that you’re ready to make your dream of home ownership come true. To help you get started, here are four simple tips to buy house and land packages for the first time.
1) Decide if you need extra help with financing
If you find a home that’s right for you but don’t have enough money to buy it, consider talking with a mortgage broker. Mortgage brokers are usually paid by lenders and not by you, meaning they have no conflict of interest when it comes to helping you secure financing. They can help you make sure your credit score is in good shape, determine how much house you can afford based on how much income you bring in each month and take care of everything else so that your application will be processed quickly. The best part? It doesn’t cost anything extra if they help negotiate better rates or fees; their work is all included in their fee!
2) Don’t let an agent talk you into more house than you can afford
Just like your credit card or mortgage, your interest rate is likely to vary based on many factors. Talk to multiple lenders and get competing offers before deciding on a mortgage. This can save you as much as $400/month in interest payments, which over 30 years amounts to more than $70,000. (Keep in mind that different lenders will offer you different rates depending on how much they think you’ll qualify for.) Also consider looking into getting preapproved by several banks; that way, when a lender gives you an estimate of what it would cost to finance a home, you’ll know if it’s within your budget.
3) Shop around for your mortgage
A mortgage is a loan, which means that you’ll have to pay interest on your home purchase. You may also be subject to closing costs, origination fees, and mortgage insurance. When comparing mortgages, it pays to shop around to ensure you’re getting good value. You can compare rates online or by calling several lenders and ask them questions about points (an upfront fee paid when applying for a loan), origination fees (fees collected at closing), and any other features you’re looking for in a mortgage. If possible, try to lock in your rate with one lender before shopping around—this will save you time by preventing each lender from asking you if you want their quote again since they know another lender has pre-approved your loan.
4) Look at all available home options
You don’t have to settle on buying a home right away; in fact, waiting may help you make a better, more informed decision. You may want to consider renting your first place or co-buying with friends or family. There are lots of options. Narrow down what exactly it is that you want in a home and then look at your budget and whether you can afford those wants (and if they fit). This way, when you are ready to buy your dream home, you will already know everything about it! Additionally, when looking at homes for sale be sure to make an appointment with a real estate agent before making an offer! Getting professional advice is important because there are so many factors that come into play when purchasing a property.