What First-Time Home Buyers Need To Know
My team and I regularly come in contact with first-time homebuyers looking for some guidance. The prospect of buying your first home can be an anxiety-inducing one, especially if you don’t know where to start. I've spent my career helping thousands of people find the perfect home, so I'm happy to shed some light on the subject for those new to the process.
Patience is key.
Even after you spend hours searching through listings and going to showings, your journey is far from over. Getting a mortgage, having the home inspected and going through the closing process all take time. General wisdom suggests that the process could last from 30-90 days, but that depends on a lot of extenuating factors. Know going into the buying process that you’ll need to practice patience if you want to find the perfect match.
The neighborhood you choose is important.
We believe the neighborhood you live in is just as important as the home you live in. When you make a purchase based solely on the number of bedrooms and bathrooms or square footage, you're missing out on the lifestyle component of your new home. Where you live will determine not only obvious factors like where your children go to school and how much you pay in taxes, but it also determines more nuanced factors, like how you spend your weekends. Spend time in an area before deciding to buy there, and see if you can really imagine yourself living there on a day-to-day basis.
Have your documentation ready.
Keeping everything digitally organized — rather than trying to keep track of a stack of papers — will help immensely. Have pay stub statements, proof of assets and any loan or credit card debt documentation readily available. Expect to present more paperwork than you might think they need to see. Like a Boy Scout, the key here is to always be prepared!
One sentiment that almost all of the homeowners we asked expressed is just that: the importance of being flexible. You may have a list of features that make up your perfect home but ultimately discover that you are unable to find all of those features within your budget. Know which “must-haves” you’re willing to compromise on and which ones you really need. If a short commute is most important to you, you may be willing to sacrifice an extra bathroom or granite countertops to be closer to work.
In other words, don’t buy beyond your means. Deferring principal payments in order to get into a bigger home is often a risky proposition that can lead to financial strain. Work out a budget that’s realistic, and then stick to it. Not sure how much house you can actually afford? NerdWallet provides a calculator to help you determine that based on location.
Like any other major purchase, it’s important when buying a home to weigh your mortgage options. Different banks may offer different rates, so getting a wide range of offers can save you money. Planning ahead is your friend in this scenario — as soon as you think you may be interested in buying a home, start the mortgage process. This will also help you determine how much you can feasibly afford.
Don’t let fear stop you.
There’s no doubt that the home-buying process can be daunting — and for first-time buyers, the uncertainty can lead to dread. You will experience a range of emotions in the pursuit of finding your perfect home, but it will be worthwhile when you finally settle in.
At the end of the day, buying your first home will be an intensive process, but it doesn't need to be a scary one. If you go in with a strong plan and know your facts, you'll avoid making the wrong choice or missing out on a great deal. Take the wisdom of homebuyers before you and let it guide the way.