So, you’ve finally decided to make that exciting leap and buy your own home. First of all, congratulations! This is a big step in your life and you’ve worked hard to get here! However, navigating the pitfalls of the real estate market can be a tricky business, especially if it’s your first rodeo, so to speak. There’s paperwork and mortgages and marketing and legal concerns and all sorts of chaos that can be quite overwhelming to fight through it all. Without the right knowledge, it’s certainly going to feel like a fight, but knowledge is power, and armed with the right knowledge and the right help, it doesn’t have to be.
That’s what your real estate agent is there for: to help you navigate the battlefield of the real estate market, arm you with knowledge, and provide you with the backup you need to win the day. As the saying goes, the cavalry’s here!
One of the first things you need to be aware of when you start looking for a home is how much “home” can you actually afford? One of the most common frustrations for first time home buyers is finding that perfect house only to discover it’s outside their price range. Before you go out search, sit down with your mortgage banker and find out exactly how much you can actually afford and save yourself a lot of headache in the future. On that same note, know the difference between “pre-qualified” and “pre-approved.” A lender may tell you that you are pre-qualified for a certain amount, but when you’re pre-qualified, little to none of your financial information is actually verified and you may not actually qualify for that amount or anywhere near that. Pre-approval is far more accurate, as much of your information has been verified and sellers know that your offer is more solid, so you’re in a better position to negotiate.
Another important aspect is to get the right kind of mortgage. Never be ashamed or embarrassed to admit you don’t know something about mortgages. Mortgages are confusing, especially for first time buyers, so remember that there’s no such thing as a stupid mortgage question. Ask your banker about anything and everything that you can think of and a good mortgage banker will be asking you a lot of questions about your financial needs to make sure they match you with the right mortgage for you.
Something you’ll definitely want to do is to have the house inspected before you buy. A few hundred dollars for a licensed professional is a small investment for peace of mind and can save you a lot of headache down the road. Be present during the inspection and ask questions along the way. This will not only allow you to learn about the true condition of the house, but you’ll learn how everything works as you go. If an inspection reveals any issues, the seller may lower their asking price accordingly or simply have repairs done. If the issues are severe, you may decide you no longer want the home. Either way, it’s worth your time and money to have the home inspected before you invest in the home.