Buying a home is a big deal. Too often, people rush into homeownership because it’s seen as a sign of adulthood and financial responsibility. But owning a home is a big commitment, and there are no guarantees when it comes to long-term investments. While homeownership can definitely be a smart move, the process of purchasing a home can be a challenge. Using a Realtor is one way to ease your fears and have an advisor there to guide you in every step. Additionally, here are a few questions to ask yourself before taking the homebuying leap…
- Is it really time for me to buy a home?
Do you have a down payment saved? It’s widely known that 20 percent down is what’s needed, but first-time homebuyer programs often allow less – some as little as 3 percent down.
- How much home can I afford?
Before you start looking for your dream home, you need to know a realistic price range for yourself. Work with a lender to get preapproved based on your financial situation. This also ties in with mortgage rates. It’s always important to compare mortgage rates from at least three leaders. This can save you more than $3,500 over the first five years of your loan.
- What external factors are important to me?
- Research nearby schools (even if you don’t have kids) since they affect home value.
- Look at local safety and crime statistics.
- Map the nearest hospital, pharmacy, grocery store and other amenities you’ll use.
- Drive through the neighborhood on various days and at different times to check out the traffic, noise and activity levels.
- Can I go over budget?
Look at properties that cost less than the amount you were approved for. Although you can technically afford your preapproval amount, think of it as the ceiling — and it doesn’t account for other monthly expenses or problems that arise as part of homeownership like a broken dishwasher, especially right after you buy. Shopping with a firm budget in mind will also help when it comes time to make an offer. Stick to your budget to avoid a mortgage payment you can’t afford.
Remember these tips, and you should be confidently making your way into your first home in no time! IF you really want to prepare yourself for the homebuying process, check out our last blog about The Biggest Mistakes First-time Homebuyers Make, and connect with a Baldwin Realtor to get started.