Buying a home will likely be the biggest purchase you make. Until you buy your second, more expensive home. And maybe that lake house, too. Although prices are rising, homeownership is still a major part of living the dream. It’s often cheaper than renting in the long run, and one of the proven ways to build wealth fast. It’s no wonder why more people are taking the plunge now more than ever.
Here are 3 must-knows for any first-time homebuyer.
Get a Preapproved Mortgage
While your dream home may or may not be within reach today, it’s good to know where you stand. Don’t get stuck buying more house than you need, getting married to your sky-high mortgage, or finding out micro-living isn’t actually for you. Putting time into researching how much house you need-and can afford-is one of the most important steps in buying real estate.
Set Limits for Your Down Payment
First-time homebuyers often purchase a home with a down payment of little to nothing. The hard truth is, this often means you aren’t ready for homeownership. If you don’t have enough to make a substantial down payment, how are you going to afford everything else? Remember, expenses like the mortgage, taxes, and insurance are just the beginning. Costs associated with maintenance, repairs, and taxes are always lurking around the corner.
Know If You Can Afford the Mortgage
A home is a major purchase. Duh. Saving the difference between rent and estimated mortgage payment, in addition to taxes and insurance, for six-to-twelve months is common practice for first-time homebuyers. After that, a realtor can help you find the right house that works with your budget.
What You Need to Know
If you’re interested in purchasing a home and need help getting started, reach out to a local real estate professional now to take advantage of the support, experience, and network they offer.