Making probably the biggest purchase of your life can be a very exciting and nerve-wracking process. By doing a little research beforehand and partnering with a great agent, you will be able to navigate the process much more smoothly.
Start Saving Early
While a 20 percent down payment is common, you don’t necessarily need that large of a down payment to purchase a home. A small down payment can still be a hefty amount though so saving money early makes a difference. How should you know how much to save? Start by plugging some numbers into an affordability calculator and set an appointment with a lender to discuss what types of financing you may qualify for. Make a plan to save! Set aside any tax refunds, work bonuses, create an automatic savings plan and use a budgeting app to track your progress.
Determine Your Non-Negotiables
Before you start house hunting, think about your lifestyle and values. What would make you happy? And what would make you miserable? Having a list of non-negotiables will be incredibly helpful to your realtor so they can find you the best homes to consider.
What are some things to consider?
- Square footage
- Condition (Fixer Upper or Move-in Ready)
- School District
Once you start looking and get to know the market and available properties, you can always reevaluate your list and make adjustments.
Explore Your Financing Options
When you purchase a home, obtaining the right mortgage loan is just as important as finding the right home. Many first-time homebuyers get a quote from only one lender but this can be an expensive mistake. Comparing mortgage rates from at least three lenders can save you more than $3,500 over the first five years of your loan, according to the Consumer Financial Protection Bureau. Shop around and and consider all of your mortgage loan options before you make a decision.
Set Aside More Money for After Move-In
Saving for the down payment is crucial but buying a home also comes with other unexpected expenses after you close. You don’t want to be caught off-guard when a major expense like replacing a water heater occurs. Make sure to start a separate fund for when these costs inevitably arise.
You will be working closely with your real estate agent so it’s crucial you select someone who you will work well with. Picking a real estate agent shouldn’t be any different than choosing any other teammate, partner, or service provider. You must ask yourself, with whom do I work best? Who are the types of people that make the best teammates? What does success look like to me? Be selective about whom you team up with for the largest transaction you will make in your life.
The Williamson Group has a great track record of helping first-time homebuyers and would love the opportunity to work together. Send us an email at Schuyler@wgrouprealestate.com or give us a call at 512-437-1059 anytime.