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First-Time Homebuyers: 11 Tips From 10 Home Buying Experts | ChatterSource

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HomeApril 10, 2020This article may contain affiliate links. We may receive a commission for purchases made through these links.&nbsp;Privacy Policy.Buying a home is most likely the most substantial investment you will ever make. It can be very overwhelming, a lot of paperwork and new terminology.It is important to understand what you are getting yourself into, especially if it is your first time buying a home.We talked to 10 experts in this field and got 11 great tips and insights for first-time homebuyers.Society is great at pressuring you to feel like you need to do certain things and certain times in your life.Getting married, having a baby and buying a home are all up at the top of that list. You might see your friends or family members at different stages of their lives and feel pressured to do the same thing they are doing.Buying a home is not something you should rush into or feel pressured to do, ever.Shannon McNulty from We Love Maple Ridge, is in the top 1% of Vancouver realtors and has over a decade of experience in selling real estate. She weighs in on the importance of buying a home for you.&nbsp;“Buying a house is one of the biggest decisions you will make in your life, so you need to make sure everything is in order before you make this leap. In addition to your financial readiness, there is your emotional readiness to consider. One thing I like to ask is “Are you ready?” McNulty shares.McNulty elaborates, “owning a home means you are responsible for everything, and that could affect your lifestyle as money previously spent on enjoying life is now going to home maintenance, upkeep, renovations, etc. This can be quite a shock for many people, so you need to keep this in mind.”As much as you need to buy a home for you, it’s important to understand the responsibilities financial or otherwise that come with owning a home.Making a plan seems like an obvious tip, but it is critical to the purchase process and oftentimes overlooked due to the excitement around buying your first home.Whether you are buying a home solo or with a partner, this is an important step and will help you with the entire home buying process.Shannon McNulty from We Love Maple Ridge expands, “if you are ready to make the leap into buying a home, make a realistic plan to see if you can truly afford it. You’ll need to include financial details, such as mortgage payments, bills, emergency savings to cover any surprise repairs, renovation costs, maintenance and upkeep costs, and taxes.”“Add a section where you include your long-term and short-term goals, such as vacation plans, wedding, new car. Do not forget your existing lifestyle expenses that you would like to keep part of your life, such as going out for dinner with friends, parties, etc.”, McNulty continues.You might realize after everything is laid out that your budget is smaller or even higher than you expected.Another thing to consider when you begin your planning is to check your credit score. If it is low, then focus on getting that number up before looking into lenders.Jacob Dayan, CEO and Founder of Community Tax, expands on the importance of checking your credit score early in the process. He shares, “your credit report must not contain any errors and if so, you must fix those errors which can take some time and delay your process.”Dayan continues by saying, “purchasing a home comes with a lot of expenses which is why the earlier you prepare yourself, the better financially ready you will be.”Most experts or anyone that has purchased a home before will share the importance of comparing lenders and rates. It’s important to have options and understand your options. It is okay to share with lenders that you are shopping around; they expect it.Ask a friend or family member for a recommendation on who they have used in the past. You can obviously ask your realtor too, but you can always rely on friends and family, to be honest with you!Veterans often qualify for specific housing benefits that are different than the standard options.Peter Van Brady, Founder of SoCal Va Homes expands, “if you are a veteran or active service member, then SoCal VA Homes encourages you to talk to us about using VA home loan benefits. There are so many reasons for a borrower to use VA home loan benefits instead of a conventional loan besides the optional down payment and lower interest rates mentioned above.”“Determine what you can afford. Your household income, available savings, and monthly debts will largely determine how much you can afford when purchasing a new home. You will also need to think carefully about where to purchase a home,” Brady shares.Related: 5 Ways to Reduce Your Monthly Housing CostsIt is important to understand what amount of house you can afford before you even start looking at homes. Don’t waste your time even looking at places that are out of your price range. The last thing you want to do is fall in love with a house that is way out of your budget.Connie Heintz, Founder of DIYoffer, expands, “Before you go to any open houses or start shopping for real estate agents, get a preapproval letter from your bank. It takes some work, but you’ll have to do that at some point in the process anyway.”By getting pre-approved beforehand will save you and your realtor time. “Your bank will let you know how much money you’re qualified to borrow, so you can bring that letter to your agent later on. It’ll help them determine the type of properties they should be showing you so you don’t get your hopes up about a house you can’t afford,” Heintz adds.Making a plan also includes putting together a list of non-negotiables. If you thrive on dinner dates in the city or catching a Sunday matinee at the performing arts complex, a commute might seem scary.If you love nature and enjoy a stroll in the park, living in a neighborhood full of concrete might not make sense either! This is your house and your decision. That being said, it’s important not to pigeonhole yourself because of all of your non-negotiables. We suggest you make a list and rank them from highest to lowest importance.Brady from SoCal VA Homes says, “consider how location affects the price of the home and ongoing expenses (e.g., property taxes, HOA fees, etc.). A good rule of thumb is to not spend more than thirty percent of your monthly household income on housing, although at today’s home prices, this benchmark is a bit idealistic.”Your realtor will understand you are working within a budget but might suggest looking at homes that aren’t ones you would pick out. It’s a good idea to check out a variety of home styles, designs and layouts to understand what you like and, more importantly, what you don’t like before you pull the trigger on a new home.You’ll hear the number 20% thrown around a lot as a standard for your home down payment. If you are able to put down 20%, that is great; you won’t have to pay PMI (private mortgage insurance).While this is ideal, it is not always realistic for everyone. Just because you haven’t saved up 20% doesn’t mean you can’t buy a home.David Bakke is a home buying expert at Dollar Sanity, shares some insight about down payments. “ You don’t need to necessarily go to 20% which is ideal but try to get close. Every dollar you put down initially is one dollar you won’t have to pay back in terms of interest.”The more you are able to put down, in the beginning, the less you have to pay off (with interest). Plus, the more you are able to put down chances are the better interest rate you will receive.Calculate a number you are comfortable with that will give you a little cushion in case any unexpected expenses come up (and they will) and move forward with whatever you can afford.Remember, this is your house, your money and your decision at the end of the day, so you need to be comfortable with the down payment amount.Closing costs can catch first-time homebuyers by surprise. Closing costs do not include the home inspection, appraisal, sewer scope, radon tests, lead-based paint assessments, earnest money, etc.Closing costs can range, but they tend to be around 2-5% of your total home value. So if you bought a house for $300,000, the closing costs would range from around $6,000 to $15,000 on top of your down payment.James McGrath, Co-Founder of the NYC real estate brokerage, Yoreevo,&nbsp; shares that closing costs can add up and “ we recommend planning to live in a property for at least 5 years because that should give the property enough time to appreciate and at least offset the transaction costs in total.”It doesn’t matter if you are purchasing your first or tenth house; there will be unexpected expenses that pop up. It is always a good idea to have a little extra buffer of cash for any unexpected expenses.Michael Kelczewski, a Realtor with Brandywine Fine Properties Sotheby’s International Realty shares, “as a Millennial real estate broker, I often represent first time home buyers. That said, home stewardship remains a large factor many forget. Roofs, major systems and other elements only last for a finite period. Understanding basic maintenance/repair costs surprises many.”Bakke, from Dollar Sanity, also adds, “You might need to shell out $3,000 or more on things like extra appliances, fixtures and other amenities for rooms that you never had before. This was the most surprising expense for me.”Basically, things add up, and we can’t stress enough the importance of a buffer of savings.Any homebuyer should have a thorough inspection performed before they agree to anything. Sometimes realtors will recommend you put in an offer that is contingent on a positive inspection.Depending on the property you are looking to buy will determine what type of in-depth home inspection you should do. If you are buying a condo, with an HOA, they should cover things like exterior upkeep, roof maintenance and overall aesthetics, hence why you pay HOA dues every month. A word of advice, make sure your HOA has enough in reserves in case they need to replace a roof, they can cover it. Otherwise, they will be knocking on all the owner’s doors to help pay for a roof replacement.If you are buying a home with a big yard, the inspection might look a little different. A landscape inspection might make sense before you fully commit to buying a new home.Peter Miller, Founder of GardeningStuffs, shares, “ unlike a standard home inspection where it only inspects the condition of a home, a landscape inspection takes trees, shrubs, drainage, irrigation and the like into consideration.Miller continues, “this then can help homeowners have a clearer understanding of the property’s outdoor features and learn what kind of repairs and/or maintenance is needed.”It is not uncommon for neighborhood associations to have strict rules on lawn upkeep and maintenance requirements, and if you do not follow those rules, you will be fined. Making it even more important to understand your responsibilities as a new homeowner.There are plenty of home inspectors to choose from, but it is important to trust the person you are working with to check every single detail.Connie Heintz, Founder of DIYoffer, suggests to, “hire your own inspector, too, because the seller could just have their brother or cousin inspect it if they wanted to.”A “fixer-upper” can seem like an exciting project to take on to truly make your first home your own. While deep down we’d probably all find satisfaction in swinging a sledgehammer and knocking down a wall, that can add up very quickly financially.John Bodrozic, Co-Founder of Home Zada, adds some insight if you do decide to go down the route of purchasing a “fixer-upper.”Bodrozic recommends, “If you buy a home that needs some work, make sure to financially manage all your remodel projects. This means setting an upfront budget, doing research on different products and materials, and tracking all the costs.This will not only help you stay on budget, but you must save all the receipts, warranties, costs, photos, etc. for future tax and resale purposes,” Bodrozic continues.If you decide to remodel any part of your home make sure to keep all of the costs, updates and receipts handy for when you are ready to sell. Just like you required a detailed home inspection before buying, the future owner of your home will want the same thing! This documentation will also help your appraised value be more accurate.As first-time homebuyers, it can be easy to look past the fact that your home is an investment. Every month you are paying a mortgage you are building more and more equity; this is something to celebrate!Ethan Taub, CEO of Loanry, a company that helps individuals with all types of loans, including mortgage loans, lends some advice for first-time homebuyers.Taub advises first-time buyers to “remember, a house is not just a home, it’s an investment and hence a business decision. The more thorough your research the better deal and house you can secure yourself.”Buying a new home is very exciting and should be a celebratory event!Don’t get caught up in all of the excitement and forget to make a plan, do your research, save as much as you can and understand the entire out of pocket costs.Happy house hunting!‍You might also be interested in: Mortgage Refinancing Advice From 9 Finance Expertsview postChristine Devereaux Evangelista is the Editorial Director for ChatterSource. In her free time, she enjoys volunteering, arts &amp; crafts, baking and binge-watching crime dramas. She lives in Denver, CO with her husband, Darin and Goldendoodle, Walter.view postHomeOctober 2, 2023LifestyleSeptember 25, 2023Fashion &amp; BeautySeptember 25, 2023LifestyleSeptember 21, 2023LifestyleSeptember 18, 2023PetsSeptember 8, 2023FacebookInstagramPinterestTwitterWe respect your privacy. No obligations here. Unsubscribe any time.No spam ever. Read&nbsp;Terms of Service and&nbsp;Privacy Policy

HomeApril 10, 2020This article may contain affiliate links. We may receive a commission for purchases made through these links.&nbsp;Privacy Policy.Buying a home is most likely the most substantial investment you will ever make. It can be very overwhelming, a lot of paperwork and new terminology.It is important to understand what you are getting yourself into, especially if it is your first time buying a home.We talked to 10 experts in this field and got 11 great tips and insights for first-time homebuyers.Society is great at pressuring you to feel like you need to do certain things and...

First-Time Homebuyers: 11 Tips From 10 Home Buying Experts | ChatterSource

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