Winter is the perfect time to purchase your new home! With so many hoops and obstacles to jump through in the home buying adventure, let Security State Bank guide you through it! Before you launch the search for your new abode, consider these do’s and don’ts of first-time home buying to make the process as quick and easy as possible.
Do:
- Secure a loan before a home: While the hunt for your new home is exciting, your final decision will depend on the mortgage you can secure. Your first step in the home buying search should take place with a loan officer who can assess your mortgage qualifications, and your pre-approved mortgage amount. This provides a framework in guiding the search so you don’t expend time and money on houses outside your budgeted means.
- Take your time: The average homeowner occupies their house for nine years before relocating. Ensure your choice is the best by conducting extra research and planning any potential projects or remodels along the way. Make sure to track trends in the housing market to discover the most cost-effective season for your area. Weigh personal, important factors beyond price listing, such as neighborhood quality, length of commute, and room to expand as your family continues to grow.
- Consult the professionals: The listing agent represents the interests of the seller, not the buyer. As a first-time home buyer, you’ll need as much trusted, unbiased advice as you can garner. Ask friends and family to recommend their real estate agents so you receive counsel from a professional with a track-record of success.
Don’t:
- Look at homes well over your budget: You set a budget for a reason. Stick to it! Paying more than you designated for a home can financially limit you to update and repair as needed. By spending within your originally determined limit, you’ll avoid heftier mortgages and continue to withhold extra funds for any household incidentals.
- Empty savings into a down payment: Securing your mortgage requires a down payment. Putting down less than 20% requires you to buy mortgage insurance ranging about 0.3% to 1.5% of the original loan amount each year. To avoid this added expense, some home buyers drain their savings to cover the down payment upfront. Liquidating your account, however, leaves you without a safety net in the event of job loss or medical emergency. The expense of mortgage insurance is worth the financial cushion you can leave in your account, and you can always eliminate the added insurance by refinancing your mortgage once you’ve paid off 20% on your principal.
- Speed through the closing: The end is in sight, but don’t let the glow of the finish line obscure your view of the paperwork. Review documents with a fine-tooth comb, double check that nothing has been altered in your agreement, and ensure that it describes your understanding of the transaction to a “T”. A day or two of extra analyzing can save you years of headaches!
Begin your home-buying process today with our mortgage lenders at Security State Bank, we’d love to help you get started!