With the downturn that the economy has undergone, the experience of buying your first home has seemed to have transformed from a smart investment full of hope for the future into a scary and perilous financial risk. However it doesn’t have to be! With some smart decisions and a little knowledge of the world of real estate, buying a home can still be a great investment.
Buying a home is a process, and like any other journey, there are certain steps you can take to ensure you reach your goal safely and successfully.
The first step when it comes to buying your first home is figuring out what your budget it. One of the biggest and most common mistakes first time homeowners make is buying a home that is beyond their means. While splurging on that 4 bedroom home may seem like it is worth stretching your monthly income, all it would take is one unexpected major expense to cause a cascading financial avalanche that can ruin your credit and cost you your home.
Before you start looking at actual homes, you should find and meet with a lender. They will be able to help you figure out your budget, including how much money you will need up front for a down payment and closing costs. If you qualify, there are also some government programs that can help you get into your first home with a low interest first time buyer loan.
Finding The Home Of Your Dreams
Once you have gotten your finances in order and have established a budget, the fun begins! Before you set out to look at homes, sit down and decide what features your new home must have. There are hundreds of homes on the market in any given area, so knowing what you want can help narrow down the list considerably.
The next decision you will need to make is location. If you have children, you will want to check the schools in the area of any home you consider, as well as the amount of crime present. In addition, find out if certain areas are prone to natural disasters, especially flooding. A home on a floodplain may seem like a bargain until you find out the cost of insuring it.
Once you have the criteria and location narrowed down for your new home, it is time to get professional help. A good realtor will be your greatest asset as you search for your new home. Ask your family or friends if they have anybody they can recommend. Since you have already narrowed down what you are looking for in a home, your realtor will be able to target specific homes that are a good fit for you and your family.
Buying your first home can be a scary prospect, but you stand to reap countless benefits. Why throw your money away on rent every month when you can often get a mortgage with a similar (or lower) monthly payment that works towards paying off a home of your own.