Buying your first home can be a learning experience under normal circumstances. Add rising interest rates and low inventory into the mix, and first-time buyers are facing some unprecedented challenges in the market.
However, despite the market volatility, our REALTORS® are helping clients land their first home every day. It just requires a bit of planning and patience. If you're planning to buy your first home this year, have a few suggestions to help you prepare:
- Get Pre-Approved Before Shopping
Shopping for a home before you're pre-approved for a mortgage is a big mistake. It is critical to know what you can afford to spend before you start your home search. If you do find the right home and there are multiple offers, a seller is unlikely to accept your bid if you don't include a pre-approval letter. Getting pre-approved is a fairly simple process, so make sure it's your first step.
- Be Clear On Your Nonnegotiables
When buying your first home, you may be forced to make some tradeoffs. Perhaps you'll find the perfect home in the wrong location. Maybe that home with the beautiful kitchen doesn't have an attached garage. You'll most likely encounter numerous scenarios that will force you to re-think what's important to you. Start by identifying three or four features you can't live without, as this will force you to become more targeted in your home search.
- Don't Make An Impulse Purchase
If you don't have much experience with home shopping, we recommend looking at many homes so you can start to develop a better sense for what you like and dislike. Touring multiple homes also gives you a sense of what's available on the market within your budget. Making an offer on the first home you like isn't always a good idea unless you're absolutely certain it's your dream home. There are many great Bronxville homes for sale on the market, so make sure to shop around.
- Focus On Your Credit Score
If you know a home purchase is in your future, then now is the time to start working on your credit score. Your credit score can directly influence the interest rate on your mortgage. Pull your full credit report from Experian, Equifax, or TransUnion, or download a free credit monitoring app. Once you know where your credit score stands, do what you can to improve it. Pay down any debts you can and make sure to stay on top of on-time monthly payments.
- Budget For Closing Costs and Pre-Paid Expenses
While the down payment is usually the largest upfront expense, it's not the only one. Buyers also have to cover closing costs, which can include dozens of fees related to the transaction. Closing costs usually range from 3% to 7% of the purchase price. You may also need to fund an escrow account to pre-pay the year's homeowner's insurance and property taxes upfront. It's critical to factor in these additional expenses when budgeting.
- Find The Right Real Estate Agent
A good real estate agent can make or break the home-buying experience. A Realtor will help you find the right home, negotiate the best deal, and guide you through the complexities of the closing process. Therefore, you want to work with someone you can trust. Always interview potential candidates before deciding on the right agent for you.
With a little work upfront and a good agent in your corner, buying your first home can be a breeze. Contact us for more tips on buying your first home.