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Buying a home for the first time can be intimidating. First-time homebuyers account for 33% of buyers each year, so this represents a good chunk of people going through the process.
It becomes far less scary when you put together a checklist of to-do’s that will steer you in the right direction. We’re proud to provide you with the most important variables to consider.
These tips will help any first time home buyer that needs help understanding the process.
Know Why You’re Buying a Home
A new home buyer should start the process by answering one simple question – why?
Get honest with yourself about why you want to become a homeowner so that you can make decisions that work in your favor. There are plenty of benefits of purchasing a home, so consider which of the following applies to your situation:
- You’re tired of renting and want to own where you live
- This is a starter home that you’ll later use as an investment
- Employment or life changes brought you to a new city
- Your family is growing, and you need more space
- The housing market is thriving where you live, so you’re striking a good deal
Once you can answer your “why” of homeownership, you’re ready to go through the tougher parts of the process.
Break Down Your Finances
When you’re figuring out how to buy a home, start by putting your financial picture in order. This will help you learn what you can afford so that you don’t default on a 30-year mortgage.
Consider these financial details as you put together documentation:
- Study how much money you earn each month
- Compile bank statements from all your accounts
- Consider any equity you have in the stock market, crypto, or other real estate transactions
- Run your credit score and get copies of your reports
- Assess any consumer debt you hold
Examining your financial picture is important so that you can get whatever lending and financing you need for your home.
Scope Out Price Ranges and Neighborhoods
Next, you need to figure out where you want to live, and what kind of price point that means. Learning how to buy a home for the first time requires you to choose neighborhoods where the property values are increasing.
Consider the tax rates, future development, the number of acres included with the lot, and other factors. Also, choose a neighborhood with a crime rate that you’re comfortable with, and study the nearby traffic patterns and transportation options.
Handle Inspection and Closing
Make an offer on the piece of real estate that you fall in love with. A real estate agent can help facilitate this process for you. The offer should be a little less than you expect to pay, but not a lowball offer.
Start putting together a team of lawyers that can go over the contracts with you, and find contractors that can handle the final inspections for you. All of these professionals will help you close on the property so that you can sign the deed and move into your very first home.
First Time Home Buyer 101
A first time home buyer has their work cut out for them, but the results are so worth it in the end. Use this checklist when you’re in the market for a home, and start reaching out to pros that can assist you.
Check out our other posts related to real estate, homeownership, business, and other life topics.
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