Home buyers need a fundamental overview. And this is mainly true for those people buying their first homes who are not familiar or accustomed with the process. Remember that the home buying process can differ from state to state, relying upon local customs.
Buying your first home can be a time-consuming and stressful experience. It’s a big deal, a big commitment, and a truckload of work. Owning your first home is a long-term move, so you have to know and understand what you are getting into.
The challenge of home ownership, especially for first-timers, can seem very daunting that it is tempting to just opt with the first property that falls in your financial range. To help you make the process easier and clearer to understand, here are five tips for buying your first home.
Get a Real Estate Agent
If you wish to go to open houses and search homes through thousands of options online, then you do not necessarily have to get a real estate agent. However, hiring a real estate agent will help you save more of your time. Here is why:
- A real estate agent can usually identify and determine overpriced house listings and give you pointers right away.
- Some real estate agents will view or inspect homes on your behalf.
- When going house-hunting, the real estate agent will usually use their own car and not yours. So, you can save gas when you look for potential homes.
- Real estate agents usually know if any new listings are approaching that are not, for the most part, listed on the market.
- A real estate agent can provide you with home listings from multiple listing services that meet your requirements, and you do not have to put a lot of time and effort scanning active short sale contingent listings.
Look for a Property to Buy
Purchasing a home can be an emotionally draining and overwhelming process. Looking for the right home isn’t always an undemanding and straightforward task. So, consider scheduling at least seven properties at a time. If you go beyond that, you will surely make your head spin, and everything can get messy.
A lot of home buyers these days prefer to do lots of research online before they even do the real thing. In fact, according to NAR or National Association of Realtors, home buyers usually spend about eight weeks to figure out or decide where they would live. When the neighborhood is, more often than not, decided, most home buyers end up purchasing a property after three home tours.
Get a Mortgage Loan
Although it is not, believe it or not, always required to get a bank or a mortgage broker before you buy a home, it is best to get a pre-approval loan in advance. In this way, you would know how much you can spend to buy your first home. Also, take note that a lot of home sellers will not consider an offer if the home buyer cannot give them assurance that they can, for sure, get a loan.
The most prominent home loans for first-time home buyers are Federal Housing Administration (FHA) loans. This type of loan offers the least down payment requirement compared to a conventional home loan. But if you’re considering purchasing foreclosures, conventional home buyers are likely to obtain priority with real estate owned (REO) banks. Furthermore, you can ask your real estate agent for a mortgage broker referral.
Settle the Offer
Home buyers usually make the error or fault of collating the sales price of a property to other ones that they have seen. Keep in mind that it is a colossal mistake to collate prices among properties for sale. Why? Well, that is because home sellers can declare any sales price they want.
However, it does not mean that the property will sell at that value. A real estate agent can give you comparable sales and differentiate the unsettled sales. Pending sales means that they will eventually become comparable sales when the property closes. Comparable sales are properties that have been, for the most part, sold within three months.
You might need to compensate over list price in a home seller’s market, specifically if there are a lot of home buyers vying for the same property. Your real estate agent can offer you a fair and just price and aid you in managing your expectations. A great real estate agent understands that there’s always more to a home up for sale than its sales price. However, the cost is still paramount.
Conduct a Home inspection
A home inspection, in some states, is, for the most part, done even before home buyers create a purchase offer. In other places, a home inspection is somewhat a contract contingency. It is a contract that declares a home buyer has the privilege to cancel or annul a contract.
For example, you may not want to go and buy a home that has plenty of faulty features. Home sellers are, like it or not, not obliged to make any necessary repairs if the issues get discovered through a home inspection. But when a home buyer appeals or makes a request to the seller to make repairs, then the home seller will usually agree, instead of blowing the deal.
Home buying, especially for first-timers, is a daunting task. Thus, it is much advisable to educate yourself more about the buying process to avoid making regretful mistakes. And in that way, the home buying process could be less stressful, and you could get the home you truly want at an affordable price. Don’t forget to reach out to any mortgage company such as Annapolis Mortgage Group to help you out on your loan beforehand.