Tips For A First-Time Home Buyer
Purchasing a home is likely one of the largest investments you will ever make. But by taking the time to understand the home buying process, connecting with the right professionals, and having a plan going in, you’re much more likely to end up with a home you’ll love for years to come. Here are the top 7 tips to help make your first home purchase a successful one.
1. Establish Good Credit And Save For A Down Payment
One of the most important steps before looking for a home is making sure you have good credit and savings. Most lenders require a minimum credit score between 620 and 640 to qualify for a mortgage. Check your credit score and take steps to improve it if needed. You’ll also typically need a down payment between 3% and 20% of the purchase price, so save as much as you can before beginning your search. The higher your down payment, the better loan terms you’ll get.
2. Get Pre-Approved For a Mortgage
Once you have your finances in order, apply for pre-approval from one or more mortgage lenders. Most home sellers want to know if a potential buyer is finance-ready before showing them homes. Pre-approval tells the seller you’ve been screened by a lender and they have assessed how much you’re eligible to borrow. This gives sellers confidence you’ll be able to close on the home, increasing your chances of winning the offer. As part of pre-approval, the lender will determine the mortgage programs and interest rates you qualify for.
3. Choose A Real Estate Agent To Represent You
A skilled real estate agent can help guide you through every step of the home-buying process and negotiate the best deal possible. Finding the right agent is key. Ask friends and family for recommendations, interview multiple agents, and request references. A good agent listens to your “must haves” and negotiates on your behalf. Most agents receive a percentage of the home sale price as commission, so an agent’s interests are aligned with making sure you find your dream home.
4. Get Familiar With Your Target Neighborhoods
Do your research on neighborhoods that have what you want. Drive or walk around and observe the area at different times of the day. Check out schools, businesses, parks, traffic, noise levels, and more to decide if the neighborhood aligns with your lifestyle priorities. Search listings to get a sense of “Bradenton, FL homes for sale” within your target price range and define what features are most important to you. The more you know about the areas you want to live in and the types of homes that fit your needs, the more confident you’ll feel in making an offer.
5. Make A Realistic Wish List
Along with your research, write up a detailed list of “must haves” and “nice to haves” for your first home. Include non-negotiables like the number of bedrooms and bathrooms as well as preferences around features, lot size, parking, and more. Prioritize what’s most essential vs. what you could compromise on if needed. Share this list with your agent to guide them as they show you properties that match your requirements. Also, refer back to your list during home tours to stay focused on what really matters most to you.
6. Make A Strong Offer And Negotiate Effectively
Once you find the right home, work with your agent to create a comprehensive purchase offer. Your offer should include the sale price, earnest money amount, proposed closing date, and any contingencies. You’ll also want to choose whether to ask the seller to pay for any closing costs or home repairs. To strengthen your negotiation position, make the strongest offer you’re comfortable with initially. Then, be prepared to compromise on small requests if needed to win the offer. Listen to your agent’s expertise when it comes to negotiating terms that are fair but also get you into your ideal home.
7. Have An Inspection Contingency
Always make your purchase offer contingent upon a professional home inspection. The inspection contingency gives you an “out” if the inspection uncovers major issues that need to be fixed. A home inspector will conduct a thorough review of the property, looking for defects in the roof, foundation, electrical and more. Any necessary repairs found by the inspection can then be negotiated with the seller as a condition of the sale. Not using an inspection contingency means you risk buying a home “as is” that could have significant, costly problems.