These eight practical tips will help you be a better buyer and feel more at home while buying one.
First-time home buyers are expected to re-emerge according to a recent report by Realtor.com.® After mostly staying out of the market in the aftermath of the housing crisis, the report says millennials are expected to drive two-thirds of household formations over the next five years. With rates as low as they are, the good news is there’s never been a better time to purchase your first home. Every homebuyer is different, but if you’re like most first-timers, the experience can be overwhelming.
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1. Consider your budget. How much can you afford to spend? Home buying is much more than just a mortgage payment, so you’ll want to consider all the potential costs, including property taxes, homeowners insurance, closing costs, private mortgage insurance (if your down payment is less than 20 percent of the home’s value), maintenance expenses ― and then crunch the numbers to determine what’s affordable for you.
2. Find the right lender. Shop around for a lender who has the expertise and mortgage products you need to take this big step with confidence. Consider Rockland Trust. Our experienced loan officers will help you navigate various programs that provide incentives to first-time homebuyers and may offer lower interest rates and down payments. Typically 20 percent down is ideal to avoid private mortgage insurance, but not necessary with some loans.
3. Get pre-approved. There’s a big difference between pre-qualified and pre-approved. Anybody can get pre-qualified for a loan. Getting pre-approved means a lender has looked at all of your financial information and they’ve let you know how much they will lend you. Being pre-approved will save you time and energy so you’re not running around looking at houses that won’t fit your budget. This step also shows real estate professionals you’re serious about buying and can strengthen your negotiating power.
4. Know what you want in a house. Single-family home, condo or gated community? How much privacy do you want? How important is proximity to work or nearby amenities? Consider all the factors that will make you happy when you move in.
5. Select a real estate agent. The right agent is your partner in finding the right home and negotiating a good price for it. Find a suitable match by tapping into neighbors, friends and co-workers. You may want to interview several agents to find the best fit for you. Typically realtor fees are paid by the seller—good news as you evaluate your expenses.
6. Shop. Most home sales take place between April and July. An optimal time to start your search is early spring. There can be less competition and sellers may not yet have settled on a firm sale price for their home.
7. If you’re single, think ahead. Condos and townhouses are popular for singles, who don’t need all the room of a house, and appreciate the lower mortgage and heightened security. But don’t hesitate to ponder the future. Think about resale value. You might not have kids, but a home in a good school district might retain its value better than a property in a lesser school district.
8. Make an offer. When you feel butterflies in your stomach, you’ll know you’ve found the home for you. Your real estate agent can help you look at comparable homes to determine an appropriate offer. Once you agree on a price, turn to a Rockland Trust loan officer who specializes in first-time homebuyers like you to decide the type of loan that’s best for you.
To Get Started with Rockland Trust
For assistance in determining which option is right for you, please speak with one of our loan officers today.