I’ve had the pleasure of working with a great deal of first-time homebuyers. As a matter of fact, first-time homebuyers are amongst my favorite category of clients! As someone who has been in this position before, I know how daunting this process may seem. I bought my first home at 25 before I even considered joining the real estate industry, so all of the uncertainties and anxieties you may be feeling, trust me I felt them too. But rest assured, I am here to hold your hand through it! Let’s cover the questions I am most often asked by first-time homebuyers.
1) “I have no idea where to start….What’s the first step?”
-I cannot stress this answer enough: Loan Pre-Approval. Unless you are paying cash of course, (and if so yowza! Teach me your ways!) then getting pre-qualified for a loan is absolutely the place to start. Even if you have perfect credit and steady income, go ahead and get pre-qualified for the sake of knowing which price point you should be shopping in. Many buyers, for example, could be qualified up to $300,000 but find that they are only comfortable with the monthly payment for a $225,000 mortgage. Knowing the financial aspect up front saves you the time and potential heartache of shopping in the wrong price range.
2) “Should I shop around for my mortgage?”
-This is completely up to the consumer but I do recommend doing so. Within a 45 day period, your credit can not be continuously dinged for mortgage shopping. So why not? This is a major investment. You want to make sure you are working with a lender you trust, who offers what you are looking for, and is available to answer your questions and walk you through the financial side of this major life decision. There are
3) “How long does the home buying process take?”
-This can vary depending upon a closing date that is agreed upon by both buyer and seller, but from the time you find THE ONE until the time you’re holding the keys as a new homeowner, you can expect between 30-60 days, and that is typically dependant upon the lender’s ability to close the loan and the title company to obtain free and clear title to the property
4) “What are the up-front costs of purchasing a home?”
– Buyers can expect to come out of pocket for their earnest money deposit (typically $500-$1000 and this deposit is applied to the purchase, just submitted up front to let the seller know you are serious) and the cost of a home inspection (WELL worth the cost considering what a home inspection can uncover). Aside from this, down payments and closing costs vary for buyers depending upon what loan product you are using and whether or not you have seller-provided closing cost assistance (negotiated in your purchase agreement)
I know these answers may have just scratched the surface of all the questions you may have circling your head, and that’s completely normal! When buying a home, it is important to have a great team beside you: a real estate agent who makes you feel at ease, a loan officer that you trust, a good home inspector, etc. Don’t be afraid to do your research. This is the greatest investment one can make after all!