Buying a new home is exhilarating. It gives you and your family a chance to start fresh while opening the doors to new opportunities.
However, you must not get ahead of yourself if you want to avoid making common mistakes. Remember, buying a home is a huge commitment.
We want to set you up for success. Keep reading for the five most important things home buyers ould know before making an offer.
1. The True Costs of Buying and Owning a Home
First home buyers don’t have any experience or prior knowledge about the costs of being a homeowner. For that matter, they don’t know what costs are involved in purchasing a home. Let’s break it down.
When buying a home you there is more than just the mortgage you’ll be paying for, such as:
- Realtor fees
- Closing costs
- Earnest fees
- And more
Similarly, as a homeowner, there will be more than just your monthly mortgage payment. These expenses include:
- Homeowner’s insurance
- Maintenance and repairs (generally about 1% of the home’s value)
- HOA fees (if you live under a homeowner’s association)
- Utilities
- Services
- Etc.
Make sure you plan ahead for all of these expenses. Don’t max out your monthly budget on your mortgage. Otherwise, you might find yourself under financial strain.
2. Your Home Loan Eligibility
One of the most important things home buyers should know before shopping for houses is their home loan eligibility. Do you know how much money you can get approved for on your mortgage? Do you know what interest rates and terms are available to you?
Unless you’re one of the few cash home buyers, this is vital information to have so you know which houses fall within your budget. You don’t want to make an offer on a home only to find out you’re not qualified for it.
3. The Different Types of Home Loans
For first home buyers especially, it’s a good idea to learn about the different types of home loans available. For example, there are traditional home loans, FHA loans, VA loans, fixed-rate loans, and adjustable-rate loans.
Just as importantly, there are home buyers classes available that can help you become eligible for first home buyers grants. This can make it easier to come up with the downpayment for a house that you want.
4. Your Top Priorities
Once they get their finances figured out, home buyers need to start thinking about what they want in their next home. Create a list of priorities based on your family, your future, your lifestyle, and more. For example:
- Location
- School districts
- Property size
- House size
- Number of rooms and bathroom
- Amenities
- Nearby parks and playgrounds
- Etc.
You might also want a home (new or used) that comes with a home buyer’s warranty. Check out this home buying site to find a list of homes that meet your wants and needs.
5. The Value and Condition of the Home
Finally, home buyers need to verify the condition of the home to ensure it’s listed at the appropriate price. Hire a home inspector to evaluate the home’s condition after you make your initial offer. Then, based on the results, you can negotiate further with the seller.
If the home needs a lot of work, you can request that the seller completes the necessary updates and repairs before you finalize your offer. Alternatively, you can take the house as-is and reduce your offer to compensate for the work that needs to be done.
Looking for More Advice for Home Buyers?
As you can see, there is a lot to consider for first-time home buyers. However, as long as you do your homework and take your time finding the right home for you and your family, you shouldn’t run into any problems. Remember the factors listed above to avoid any mistakes.
And if you’re looking for more home-buying advice, personal guidance, or financial tips, stick around. Check out some of our other articles before you go to find more fantastic information.
