If you are thinking about buying your first home or condo, then you may feel anxious about the road to home ownership. The first thing a first-time home buyer should do is to begin educating and reading up on the home buying process. There is a plethora of information on the web and in your local bookstore geared towards first time home buyers. A real estate professional can be very helpful in educating you about the process and provide you with a step-by-step checklist that will help you prepare to find your first home or condo. Below is a list that will help prepare you for home ownership.
How much can I afford?
Before you start shopping for your new home, you should sit down and create a family budget. There are several free spreadsheets and resources online—click here for a free version from Google Docs. The spreadsheet will be a helpful tool when you sit down to consider how much you can afford and will help when speaking with potential lenders. We are here to help through this process, so do not feel like you have to navigate the mortgage market alone. FHA has some great programs for first time home buyers, so it would behoove you to check out their website to learn more. Click here to visit the FHA website.
After you have created your family budget, you should see how much house or condo you can afford. Click here to visit the Ginnie Mae website to use their online tool to see how much house/condo you can afford. Another option to consider is renting versus buying a home. Click here for a rent versus buy calculator.
Make a list of what you want
There are several items to consider when you start to look for your home or condo. What neighborhood do I want to live in? How close do I want to be to work? How far away is the nearest grocery store and shopping? Click here to create a list of items and features that you must have and want in your first home. Click here for another helpful checklist to prepare you to search for a home. There is a lot of information out there that will help you organize yourself, so do your homework and ask your real estate professional to help educate you on the process.
Shop for a mortgage
There are several options to finance your first home. You will hear about 30-year fixed rate mortgages, fully amortizing ARM’s, interest only ARM’s, etc. You should educate yourself on the terminology and ask a lot of questions. Click here to visit Bankrate.com to learn more about the differences between home loans and what is best for you. After you have done your homework, it is time to start meeting with lenders and mortgage brokers.
Now that you have a clearer picture of your finances and have educated yourself about your home loan options, it is time to start talking to mortgage brokers and lenders. You may want to sign up for a free credit report before you meet with a lender or you can have them pull your credit report. There are several other fees associated with financing your first home, so be sure to get several quotes from potential lenders and mortgage brokers. Feel free to contact us for a list of mortgage brokers and lenders that we have used in the past.
Start shopping for a home
There are several online resources to start shopping from the comfort of your own home. Sites like Zillow, Trulia, and MLS. Click here to get access to MLS and to sign up for free property alerts. After you have done some shopping from home, it is time to start talking to real estate professionals. A buyers agent can provide you with valuable advice and tools to make the home buying process much easier. Click here for a checklist to take with you, so you can keep track of the homes that you see. It may be a good idea to bring a camera with you, so you can remember the unique features of the homes that you see.
Make an offer
Now that you are serious about purchasing a home or condo, it is time to make an offer to purchase. Click here to read an article that I wrote with 8 tips to think about before making an offer. Discuss with your real estate pro what the initial offer should be, given the market conditions and the condition of the home. If the home needs repairs, then ask your real estate agent to build those conditions into the offer. It is not required, but I would recommend getting a home inspection. Ask your real estate professional to see a blank copy of an offer to purchase, so you can familiarize yourself with the language of the contract. Learn about the multiple contingencies that you can build into your offer, so you are protected if the inspection reveals something about the home that turns you off from moving forward. At this point, I would also contact your real estate attorney and accountant.
Prepare for Closing
You are entering the final lap and need to prepare for the closing. If you have not already done so, you will need to get a homeowner’s insurance policy and provide the policy to your lender. It is crucial to keep an open line of communication with your real estate professional and your lender. Feel free to ask questions during the process, that is what you hired your real estate professional for.
Don’t miss this charming Stapleton home on a fabulous courtyard! Excellent location near new recreation center, F-15 pool and steps away from future park/soccer fields. Open floor plan with spacious kitchen, convenient upstairs laundry room!
