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First-Time Home Buyer Guide: Everything You Need to Know

Don’t let lack of funds stop you from owning a home; many first-time home buyer mortgage programs and grants can help you realize the dream.

First-time Homebuying Process

  1. Define your budget and stick to it

When buying a home for the first time, you may be tempted to go above budget once you see the houses, but this may lead to financial problems in the future. So make sure to select a mortgage lender and realtor who have your interest at home.

Tool: Online Mortgage Calculator with PMI and Taxes

You do not want to start struggling a few months into your monthly payments. So, do a thorough audit of your finances and figure out how much you are willing to chuck out as mortgage payments to leave you with enough for bills and savings.

  1. Compare lenders

Do not just go with any mortgage lender; shop around and ask for quotes from at least three and compare their rates and choose the one with the best offer. Don’t just look at their interest rate; check how they treat their clients and reviews.

  1. Get pre-approved for a home loan

Do not start house hunting without a pre-approval, as it shows sellers you are not serious. More so, you will waste a lot of time looking at homes you cannot afford. So get pre-approved to know what you are working with and show sellers that you are serious.

Getting pre-approved also ensures that you can place an offer on a home instantly.

  1. Find a trustworthy real estate agent

Find a realtor who is knowledgeable about the area you are looking for a house. They will help you find the home that fits your needs, negotiate the best prices, and handle the paperwork.

  1. Starting home shopping

Before you go looking for a house, sit down with your realtor and explain what you need in a home and the neighborhood. Then view the houses your realtor lists with you and be keen on all features.

  1. Make an offer

When you find your dream home, please make an offer, but know that it is not definite; in some instances, you will have a back-and-forth with the seller before accepting your offer.

If the seller does not accept and can not go above what you stated, do not worry because something better will come along.

  1. Closing costs

If you do not have the money to settle the closing costs, you can negotiate with the lender for them to be rolled into your loan. Or the seller might be willing to share or cover the costs.

  1. Home inspection and appraisal

Have a professional perform a home inspection and appraisal to ensure that there are no problems and ensure that the place is inhabitable.

  1. Homeowners Insurance

To protect your home against any hazard, get homeowners insurance.

  1. Close on your home

If the seller accepts your offer and the home has passed inspection, it’s time to close on your home. There is a lot of paperwork involved and signing, and after you are done, and the money is transferred, you will receive the keys to your new home.

Summing Up

Do let a lack of funds hinder you from owning your first home. Many first-time buyer mortgage programs are available, and it would be a shame not to take advantage of them.

We’ve discussed some of the things that qualify you as a first-time homebuyer and the best home loans for first-time buyers.

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