Shopping for your first home can be an exciting experience, but it can also become overwhelming. It’s not unusual for some people to make tons of first time home buyers mistakes. For example, some first time home buyers fail to prepare for the closing costs. This can lead to disaster.
As a first time home buyer, it’s imperative for you to take measures that will help pave the way for a pleasant home buying experience. I will now cover 7 tips that can help you buy your first home without any worries.
- Pay Off Your Debts and Build an Emergency Fund
It doesn’t take a rocket scientist to figure out that owning a home is expensive these days. Before shopping for a new home, you should be debt-free and have an emergency fund in place.
- Check Your Credit Score
An exceptional credit score will help you get favorable terms from a lender. Check your credit score before applying for a home loan. If your beacon score is low, you should work on it before contacting a home lender.
- Determine Your Purchase Price
How much of a house can you afford? Besides the purchase price, you will have to deal with property taxes and homeowner’s insurance. Make sure that your budget can cover these expenses. It’s also important to mention that you must make sure that your budget can cover home repairs.
- Save Money for a Down Payment
There’s a strong possibility that you may not be able to pay cash for your home. If this is the case, you should start saving for a down payment. Your down payment should be at least 10% of the purchase price.
- Save Money to Cover the Closing Costs
The title company expects to get compensated for their services. This is the primary reason why you should save money to take care of the closing costs. In some cases, the seller will help with the closing costs. However, you should be ready to pay the closing costs.
- Get Approved for Financing
It’s now time for you to get approved for a home loan. Make sure that you deal with a reputable lender that offers good terms to first time home buyers.
- Shop for a Home and Make a Competitive Offer
You are now ready to shop for your new home. Once you find a good property, make a competitive offer. If you need help finding a home that meets your standards, you can hire a real estate agent.
Being a first time home buyer is exciting, but you must be careful. Following the 7 tips listed above can help you avoid the common pitfalls associated with buying a single-family home.