If the idea of start the path to become a home owner for the first time is rounding your head day and night, then you need to read this article. Buying a house for the first time can be a very stressful and frustrating process if you aren´t aware of all the things you´ll have to faced.
On the other hand if you get prepared and know what could come to you in any phase, would be more relax and patient about it, there is no need to become an expert about real estate, but to your own convinience learn about what implies to buy a hose will be very handful and for sure will avoid you a few troubles.
This is why today we will bring you the best 10 tips for people who wants to buy a house for the first time. Simple but very effective here is the most important things you should know before you start your path.
1- Be Sure About What to do as First Time Home Buyer:
The road to becoming a first-time homebuyer is long and is a commitment of many years, the mínimum loans to buy a house are around 15 years, and it could be even 30 years paying monthly for a house. So if you aren´t ready to settle in one place at least for the next years, then there is no need for you to buy a house yet.
Of course, you could be one of a few lucky who is buying a house only to make an investment and can keep living with their parents, in which case this advices will also work for you.
Antoher thing you have to ask yourself is if you have a stablish income, either from a job or another source, need to be sure you can afford your loan monthly. Be sure that you have a saved money to get through difficult times, at least to cover 4 months of the monthly payment.
If you are not sure to settle down, don´t have an stablish monthly income and still don´t have enough savings to get through tuff time, then think twice in become a home owner, is better to keep saving and getting ready for when the time is come.
2- Focuss on your First Time Home Buyer Mortgage Loan Before Hunt For a House
The well-known proverb says: “Don’t count your chickens before they Hatch” and that´s exactly what many first-time homeowners do, even before they get a preapproval letter they are already watching the house on the internet and thinking about the marvelous house they can buy.
But the reality is another one, generally, people see houses with a selling price much higher than what they can afford, meaning the range of price of the house they ended up wanting is higher than the amount of money approved.
This is why we recommend not to start hunting and focus on the loan, so when the preapproval letter is ready start to look for a house inside the range of price you have been approved.
The preapproval letter is a document that the lender sends you, letting you know how much money you will get for the loan.
3- What is First Time Homebuyers Credit and Why is Important When Ask for a Loan:
One of the most important requirements that all Banks ask for the approval of a loan to buy a house is to have a good credit score. The credit score of a person who wants to ask for a loan and actually be approved has to be over 620, but this score can change depending on the Bank and the program they are aiming for.
So, before you start gathering all the documents to apply for a loan to buy your house must check your credit score. Is not a secret that having a good credit score is more difficult than it looks, if you have been late in the payment of any loan or credit card then probably will have to fix your credit score before applying.
But if you have trouble with your credit score and is not enough to ask for a regular loan in a Bank, you can always apply for our program, here in BuyHouseEZ don´t ask for it, and won´t ask you to fix to approve your application.
4- First Thing Before Think in Apply You Need Savings for the Down Payment
The Downpayment is the amount of money you will give from your own pocket to buy your house, is the part of the purchase that the Bank or any lender let for you to pay. Normally you need to save to get the percent required to buy your house, the positive thing is that is an investment because it goes directly to the house, also you won´t have to pay interest for it.
More money saved for the downpayment is more money you will save in the future and less you´ll have to pay. Usually, the lenders ask you for a minimum but if you can give more than that would be better.
But if you didn´t have the chance to save for the downpayment, there are some assistance programs you might get from different lenders and even from the State, make sure you qualified as a first-time homebuyer under their criteria.
5- Check all your Options As First Time Home Buyers For Loans
One the best things you could do is take your time finding different options of loans at the momment of buy your house. There is a lot of options and will depend f your situation, never choose the first option as your right one, and don´t give up if the first one have been dennied.
Some of the types of most known and common loans are:
–USDA Loans: This ones works for people who want to buy a house on the rural and suburban áreas.
–FHA Loans: this one is the most popular it required only a 3,5% for the downpayment and a low credit score.
-VA Loans: This ones are reserved to the veterans and members of the National Guard and Armed Forces, it requires no downpayment.
6- What First Time Homebuyers Should Know About Closing Cost
This is another spend that people tend to forget about, besides the downpayment the closing cost are part of the deal and the purchase of a house, and cover services that are needed to be sure of what are you buying and avoid futures problems. This are some of them:
-Inspection: is required for mosto f the lenders to make sure the house is in optimal conditions and avoid futures expenses that could affect the monthly payment of the loan.
-Attorney expenses: goes to the lawyer who is going to make the contracts, carry the negociation and other services.
-Insurance: The insurance is a requirement for the mayority of the lenders, the house need to be insurance.
-Taxes: Is necessary to pay taxes for the negociation and others that comes with the buy of a house.
So have in mind this expenses and won´t have to ask for another loan to cover them, or have to pay interest if the lenders cover them.
7- Needs to be Clear of the Non Negotiable Conditions And Have in Mind You Ar Not Going To Get It All
One of the most common mistakes first buyers made is to think they are going to get everything they ever dream in a house, sometimes the list of “must-haves to buy” is endless and unrealistic.
So please have in mind that get the perfect house is not always the same that find the house with all in your list on it. So is necessary to have very clear what are the thing that the house really must have, and what are the ones that could be sacrified.
For example: If you work from home you will always need a room that works as an office and an extra room for it will be a must in your list, but maybe a big back yard is not so necessary so a house that has an extra room but a small back yard could work for you.
8- What Need to Do as First Time Home Buyer?: Hire a Realtor
There is no need to explain how much a good realtor can help you because is something that you have probably already listened to before. The best thing you can do is to hire a great realtor that has the patience to explain everything you need, give you good advice, knows how to get the best deals, and knows how to handle all the process until the end. Believe us a realtor will avoid you many troubles and also make you save money.
In BuyHouseEZ we can count on great realtors who work with us as partners all over the 5 States we have licenced, just in case you don´t have one yet, we can contact one for you at the momment your loan is approved with us.
9- Make An Inspection Will Save You From Futures Problems
It is almost all the time required for the lenders who need to be done an inspection of the house. This inspection consists to check if the house doesn´t have problems.
For example: a common problem with a lot of houses built early in the 1900 is the asbestos inside the walls, if it has it needs to be removed in a repair that cost thousands of dollars.
An inspection seems like an extra requirement but is really the best thing to do before you buy a house.
10- Be Careful With the Budget
It is probably one of the things the first buyers always complain about, usually because they have a limited budget, and want more than what they might afford. Spending more money than we think is normal when we buy a house, but spend more money than we can really spend is a terrible mistake an later will bring you consequences.
So think very well the reasons why you would exceed the budget, some things are necessary but some of them are just not. Buying an expensive piece of forniture only because you like it is no reason to exceed it; but make some structural repair that needs to be done or change a non-functional bathroom might be a necessary and a good reason to see the budget.