Five Tips for First Time Home Buyers
Courtesy of Indianapolis Real Estate
In today’s property market, many are taking advantage of low real estate prices and lower borrowing costs to become home owners. It makes perfect sense for many, especially when comparing the cost of renting versus buying. So how can one prepare for buying a first home?
Here are a few simple tips that will get you started:
1. Purchasing Power
Many start with a home search online and ultimately come across the perfect home. They schedule an appointment to view the property and decide it’s just what they need. Usually, they’ve run the numbers on a mortgage calculator and accordingly, believe they are looking in the right price range and can put in an offer…and that’s when all the surprises begin…
9 times out of 10, buyers don’t have the financing in place and they have to go out and shop for a mortgage. Often, this creates tensions as the final numbers don’t look exactly as hoped for. That’s why it is always wise to speak with a lender prior to looking at homes. This way there won’t be many disappointments as the financing is arranged beforehand and the property search is more fruitful and less stressful.
2. Additional Costs
Many first time property buyers don’t consider additional costs when using online mortgage calculators. Sometimes the calculators are not equipped to include these as well. Here’s a few that may or may not apply to your particular situation:
*On an FHA loan, mortgage insurance has an upfront fee, which can be financed into the loan, therefore, making the loan balance higher as well as the monthly payment.
*On both a conventional loan and FHA, there will be monthly payments for property mortgage insurance, as well.
*Closings costs include loan costs, lender’s title insurance, first year’s homeowners insurance, escrow accounts, appraisal and other miscellaneous fees.
*Home Inspection is another cost you will incur upfront
3. Choose the Best Neighborhood
As they say, it’s all about location, location, location. It is wise advice to choose an area first or a couple areas of town, then narrow your search to properties in the area within your price range. It is also smart advice to choose a smaller home in good condition, than a larger home that needs lots of work.
4. Independent Inspection
From energy efficient windows to different types of plumbing systems, researching and certifying the materials that make up a potential new home should be a priority for all buyers. A professional home inspector can help buyers identify the strengths and weaknesses of a given home, and offer tips on how to improve any problem areas.
5. Hire a REALTOR®.
Even with the enormous amount of information available online, all real estate is local. A REALTOR® can truly assist you in determining fair market value, therefore protecting your interest and your finances. A good, competent REALTOR® with experience assisting home buyers can also be a wealth of knowledge about loan programs and financing options available.
Happy Shopping!
You may view recent listings at Homes For Sale Avon In
