7 Tips for First-Time HomebuyersBuying your first home – or even your second, third or subsequent home – can be a little intimidating. It’s one of the biggest purchases you’ll ever make, which means you need these seven tips to put you on the right path.
- Be ready to pounce on a home you like. That means getting preapproved for a mortgage before you even start house-hunting; that way, you can make an offer that a seller can take seriously when you find your dream home.
- Remember that working with a buyer’s agent doesn’t cost you anything. The seller pays your agent’s fees, and it always pays to have a buyer’s agent in your corner to look out for your best interests.
- Don’t always look at homes on the high end of what you can afford. For many people, it makes more sense to look at less-expensive homes first – and it probably makes sense for you, too. If you don’t find anything you like, then begin looking at more expensive houses.
- Save as much as you can. While you don’t always have to come up with a 20 percent down payment to buy a home, remember that the larger your down payment is, the lower your mortgage payments will be. It’s also important to save for closing costs and other fees, as well as have some cash stashed away for repairs and upgrades once you buy.
- Shop for mortgages. You don’t have to use your lender. In fact, your lender may not have the perfect loan product for your needs. In many cases, it pays to shop around to get the most favorable interest rates and terms.
- Improve your credit as much as you can before you apply for a mortgage. People with higher credit scores qualify for better rates – and that means if you can pay down your debt or work toward 100 percent on-time payments, you should.
- Look for a home that you think you’ll want 5 years from now. Plan ahead for possible changes in your family size or structure, because even if something is just fine for now, your situation may change in the future. Look for homes with good resale value, too, because the statistics say that most buyers’ first home isn’t their last home.