5 Important Consideration for First-Time Home Buyers
Buying a new home is an exciting experience. Perhaps the biggest purchase anyone makes in their lifetime, here are five considerations for first-time homebuyers to take into account before making their final selection and jumping into homeownership. Having a clear picture of your financial and lifestyle goals, loan types, interest rates, the amount of a mortgage payment you can afford and any upgrades or renovations you’ll need are key to picking the perfect home. If this is your first time buying a home, read on for things to consider.
As a first home buyer, you might not be aware that there are different types of loans. In the United States, for example, first-time homebuyers can actually qualify for FHA loans that mean a lower down payment and can help to make buying a home easier. FHA loans come with the stipulation that you live in your home as your primary residence for a specific amount of time but can be ideal for most first-time homebuyers.
When considering buying a home, you’ll want to go over loan options and types of loans with a financial advisor, someone you trust, or by calling banks and lenders. Doing so will help you ensure you find a loan program that works for your specific situation. You can start with a Google search for ‘first-time home loans’ to get an idea of where you’ll stand on a home loan prequalification. Be careful about sending too many inquiries for prequalification notices as it could negatively impact your credit score, which would be harmful to securing a lower interest rate on your final loan. If you need help with this process, talking to a realtor would be a great place to go. While they don’t offer loans, they work with banks every day and understand purchase price limits, closing costs, and the other things you’ll want to go over with your lender.
Maybe you’ve already started looking for homes and found the perfect home in Houston. While it can be exciting to find the place you think you want to live, don’t rush into a bid. The first thing you’ll want to do is be sure you can afford any renovations that may be needed. If the windows need replacing, for example, you’ll want to search for the cost of new windows in Texas so that you have that in mind when you negotiate your purchase price and tie it to the loan. While those new windows are sure to look fantastic in your new home, you need to know you can afford them.
Another thing you’ll want to think about before buying your new home is any costs associated with moving. Your monthly mortgage payment will likely be higher than your current rent. For this reason and because you’ll be throwing most of your savings onto the down payment, you need to be sure you’ll have enough money left to cover the normal expenses that come with moving into a new home. From storage rentals to movers to utility hook-ups, be sure you are leaving yourself in a position where you can afford that cross-country trip to your final destination.
Many people make the mistake of underestimating the importance of location when buying a first home. Fixated on the building itself, they forget to look around town and check out the local amenities and culture. Especially if you have children or are particularly social, you’ll want to look into how the town works, the quality of schools, and whether there are houses of worship around that work for your religious beliefs and values.
The final thing to think about when buying a new home for the first time is what your big picture goals are. Ask yourself how long you plan to be in your new home, whether you’ll ever want to sell, and if the location you’ve picked will work with your overall career path. Consider the terms of your FHA or HUD home and decide if they line up with your goals before signing on the dotted line.
At the end of the day, with a little thinking, planning ahead, and your eye on the overall budget, you’ll be in great shape to begin your next adventure as a homeowner! Congratulations on your next big purchase!