5 Tips for First-Time Home Buyers

Taking the first step onto the property ladder is always an exciting time, and when it comes to buying a home, it is usually the biggest purchase someone will make in their life.

Owning your own home is the start of a world of opportunity but of course, there is also an element of risk if you rush in and make the wrong decisions. Congratulations on being ready to own your own home, it really is a life-changing event but also a huge decision process. To help you invest your money wisely, avoid some traps first-time buyers can fall into, and to even help you save some money, we have compiled our top 5 tips for first-time buyers.

Make the Biggest Down Payment you Can Afford

For many people, saving for a down payment can be hard work, take a long time and mean making sacrifices and compromises in lifestyle to make sure they have the money they need to purchase their first home. But the bigger the down payment you have, the better position you are in as a buyer. A larger down payment, even 5 or 10 percent more than the minimum required, means you have more collateral in the property from day one, you will have smaller homeowner loan repayments, and you will pay less in interest. A higher down payment can also make securing a homeowner loan easier.

Get your Homeowner Loan Pre-Approved Before you Start your Property Search

The property market moves very quickly in many areas due to high demand and a low supply of homes. The first-time buyer market is no different from the rest of the market, and if you find your dream home, being able to move quickly can be the decisive factor in securing the property. If there are several interested parties making an offer on a property, having your loan pre-approved and the money being offered to you ready to purchase, puts you in a prime position when competing against buyers who are not pre-approved and therefore not able to proceed with the purchase immediately.

Shop Around for the Best Loan Rate

With many mortgage providers available in the market, it will not come as a surprise to know that there are many different deals and products available. One of the most common mistakes first-time buyers make is accepting the first loan offer they receive, which according to research, comparing just a handful of lenders, could cost more than an additional $3000 that could have been saved. Always shop around for the best deal.

Hire a Realtor to Help With your Purchase

When buying your first home one of the most valuable tools at your disposal is the experience and knowledge of a realtor. They know the local market, the area, and its facilities and amenities, and they will be up to date with prices locally. Their years of expertise and knowledge can help you find your dream home while ensuring you don’t pay more than you should, and ensure you find the best home possible for your budget.

Don’t Forget to Budget for Additional Expenses

When purchasing your home there are various other costs to consider aside from just the sale price of the property. Closing fees, title searches, loan origination fees, surveys of the property, appraisal fees, and unfortunately, taxes too, make up a part of the overall costs. It makes sense to do your research into these costs (and your realtor will be happy to help with this) so you are aware of what your total available budget will be, but as a guide, closing fees themselves range from around 2 to 5 percent of the purchase price.

These are just a few tips to help first-time homeowners on their exciting journey to their dream home. Find out more by talking to Ed Prehoden in Del Mar, California. Call 858-217-5400.