Here’s what you should, and should not, care about when searching for your first home.
So, you’re ready to leave apartment life behind and looking to invest in a place of your own. But where to begin? There’s an overwhelming amount of advice out there, and it’s hard to know what is truly important and what isn’t. We have you covered. Here are our top tips for getting your homebuying journey off to a great start:
1. Find an Agent You Trust
Interview, interview, interview. Although real-estate sites like Trulia, Zillow and Realtor.com are great for sorting through properties that are currently on the market, they’re no substitute for a real agent. Ask your network for referrals. Once you zero in on a select few, ask them the important questions—such as what they know about your current neighborhood, and if they have worked with first-time buyers before. It is important that your real estate agent answers your questions and listens to your unique needs. Ideally, you want someone who will go above and beyond to find your perfect first home and help you negotiate the price. Bottom line: When choosing a buyer’s agent, be picky.
2. Choose a Lender
You could have your mortgage for decades, so choosing a lender is no small feat. Do your research and shop around for the lowest rates using sites such as Bankrate or NerdWallet. If you want the best rates, make sure your credit is in order. If it isn’t, take some time to boost your score. Aside from your identifying your interest rate, read through the fine print to learn about any other fees attached to your loan.
3. Pick the Right Loan
This goes hand-in-hand with choosing a lender. When determining which loan term is right for you, think about what you want your life to look like in the future, and also what’s realistic for you. If mortgage rates are low, buyers often pick a shorter-term loan. That might be smart, but you should factor in changes to your family. (Are you planning on having kids? Will you be changing jobs soon?) While short-term loans save you money in the long run, long-term loans require lower monthly payments. Spend some time going over your income and savings, and use a mortgage calculator to determine which term makes the most sense for you.
4. Hire a Home Inspector
Before closing on your home, be sure to get it inspected. Even the most perfect-looking homes on the outside can have horrors lurking on the inside. Home inspectors typically find things you can’t see on the surface, such as leaky plumbing or faulty electric lines. They do a thorough inspection of every part of the house, double-checking the heating, septic, electric and plumbing systems—in addition to the roof construction and more. If your inspector does identify issues, work with your agent to negotiate the home price with the seller, who can then pay out of pocket to address these issues or give you credit at closing. If you don’t take this step, you may be sorry: If an issue arises and you are the owner, you could be stuck with a costly repair. A home inspection usually costs between $300-$500 and is worth every penny.
5. Ignore What Can Be Easily Changed
We know it’s easy to get wrapped up in perfection. But, realistically, minor details can be changed at a later date; they do not matter at this stage of your homebuying journey. If you find your near-perfect home in your preferred location but hate the carpet and the color of the dining room walls, do not let these minor details affect your overall opinion. If, however, you take issue with the kitchen—whether it’s too small or outdated—take the cost of updating it into consideration. If the home otherwise checks all of your boxes and is offered at a decent price, consider updating it a year or two down the road, once you have fully lived in the kitchen and know what you do and do not want.
It’s hard not to get sucked into details, especially when buying your very first home. We understand that you want it to be as close to perfect as possible. But if you relax your focus less on the things that can be changed, and focus more on what really matters, you may have an easier, less stressful time finding your new home. If the things that do matter—such as working with an agent and making sure your lender paperwork is in order—stress you out, the attorneys at Anselmo Lindberg and Associates are here to help. We love helping first-time home buyers take the leap from renting to buying. Schedule a consultation today.