The process of buying a home can be a bit overwhelming for first-time homebuyers. Many buyers choose a conventional route but the best tip is to do your research before starting the process.
There are many questions that present themselves when looking for a home. We highly recommend finding a real estate expert that will aid in the process and help you understand everything before making a big life purchase. Sit down with them and ask all the questions you have so you feel more comfortable before looking at available homes.
What qualifications are needed for first-time homebuyers?
The most important decisions that factor in qualifying for a home are your credit score and eliminate any outstanding debt. From the lender standpoint, a high-risk homebuyer will have a high amount of debt that may reject them from qualifying for a home loan altogether.
There are also some other factors that play a role such as if you’re caught up with filing taxes or have a stable job with a W2 form. Business owners often have to jump through some hoops to show enough proof of income, especially if you’re an LLC or not payroll. If you got those issues squared away, great! The next step is looking for a broker or lender. We recommend shopping around for the best rates or use someone you can trust. With the extra research and work, you can get interest rates as low as 2.75% with good credit. With a 30 year fixed-rate mortgage, you can save hundreds of dollars per year.
How to Stay in Your Price Range for a New Home?
Prior to looking at any home, you need to look at what homes are currently on the market. You will want to budget homes that fit within your monthly allowance, so don’t look at homes you cannot afford. It’s also important to note that just because you got preapproved for a high amount of money, doesn’t necessarily mean that you want to spend that much. Stay within budget and you’ll thank yourself later down the road when you want to do any home renovations.
How Much Should You Put Down on a Home?
This is a very common question and one that you will need to think about in the early stages of home buying. It can take years to come up with enough money for a down payment so you will need to plan ahead. Although the key number has been 20% in the past, that has changed in recent years. Most people put anywhere from 2.5% to 5% of the home’s price down.
Should I Pay for a Home Inspection?
Yes, any home that you are interested in after an offer has been accepted needs to have an inspection by a professional. It will give you a limited review of the home’s current condition that you may not see by walking through it. This can help buyers learn about problems with a home prior to purchasing it. The risks are far worse for those that opt to waive the home inspection. Most home inspections are $300 to $400 and are well worth the peace of mind.
What Costs Should You Factor in Buying a Home?
Your main concern after a down payment is the home inspection fee, moving costs, storage facilities, and home improvements. In most cases, we recommend that as first-time home buyers avoid buying your perfect dream home, so you will have some extra spending for home improvement of your own. If you can save money in one of these areas, it will help after all is said and done. You also have to consider maintenance fees incurred when you own your own home that usually covered by the rental’s management. Things happen such as the AC going out or the roof leaking. These are common problems that can cost you thousands of dollars to fix or replace. It’s always a good idea to have separate savings for home repairs.
The entire process for closing on a home can take anywhere from 40-60 days after an offer is accepted. During that time it’s important to plan ahead. If you need to move out of your home or rental early, you may need a place to store your belongings. We recommend checking out any of our five storage facility locations across the Phoenix area. We offer 24 onsite availability with security cameras and a gate so your belongings are protected at all times. Find a location nearest you today!
All in all, it’s good to ask as many questions as you can when dealing with a realtor, lender, or home inspector. Don’t be shy, because believe it or not they’ve heard it all.Tags: buyers, buying, do, first, home, moving, time, to, what