Being a homeowner is part of the Great American Dream, but at first glance, buying your first home can appear to be a very difficult goal. First time home buyers are especially overwhelmed by this process, which is why we are sharing this info on how to buy your first home. Take a look and see what you need to know about the process of buying your first home.
Every story has a beginning, and this is the beginning of the story of you, the homeowner! A year before you want to move in is the time to take an honest assessment of where you are and where you want to be.
Check your credit score with one of the three credit bureaus. Not only will this help determine how much you can borrow for your home, it may also show you errors on our credit report that could eventually cost you thousands in higher interest rates.
Determine how much you can comfortably afford to budget and spend on your new home. Oftentimes you may be able to borrow a higher amount than you may be able to afford so you do need to do some careful budgeting to make sure you are financially comfortable.
Make a plan to put together a down payment. Most mortgages require a 15-20% down payment, but there are programs (such as FHA and VA loans) that allow you to finance a home with less downpayment, some as low as 3 percent. If you are selling assets, borrowing from a relative, or saving monthly, keep in mind that banks want to see that you have stable funds in your account. Plan to have a majority of your down payment in the account 60-90 days prior to applying for a loan.
You have devised a plan for the financial aspects of new home buying, so now it is time to determine what you want in a new home.
Make a list of all of the wants and needs that you have for your home and prioritize them. Do you want a large kitchen and dining room for entertaining? Do you need a large yard? City, suburbs, or rural? New versus resale? What can you compromise on? Depending on your budget, you may not get everything you want in a home, so by prioritizing your checklist you will know where you can compromise to get your home.
Research neighborhoods. Are you looking for a new neighborhood, or one of the last few lots in an established neighborhood? Is the school district important to you? Take everything into account including location, proximity to work, distance to shopping and any other elements that you find important.
Start a fund for miscellaneous expenses. During this time you will want to start a habit of saving money for home maintenance needs. This maintenance fund can also pay for home buying expenses that you may need to pay upfront to make your house complete, such as new lawn mower, washer and dryer, refrigerator, etc. These type expenses can easily cost over a thousand dollars, so it helps to be prepared.
When you get to this point, it is time to start compiling all of the paperwork that you could possibly need to obtain a home loan. Some documents that you and your partner may need to provide include:
Collect this information now so you will not have to stress about finding these when it comes time to apply for your loan. This is the ideal time to start considering your lending options and looking for experienced new home salespeople to help you with your home search. It could also be a good idea to look at a mortgage broker instead of an individual lender, as they can be helpful for finding you the best loan option.
Now is the time to start the process of buying a home! You know your budget, you understand your credit, you have your paperwork and are making headway on a down payment. Now you can get pre-approved for a mortgage! This would give you a good idea of how much you can borrow and the price range for your new home.
After you get pre-approved, you can finally get serious about buying your first home! You’ve done your research on neighborhoods and your priorities, so it’s time to hit the streets. Visit new home models and neighborhoods in your price range. You’ll be delightfully surprised at the prices of new homes compared with resales and rentals. At any budget you may be able to save time and money by working directly with a new home builder, so don’t shy away from new construction with quick move-in specials or even building a home to your specifications!
Once you have found a new home that you love, make an offer. Closing on the house could take 4-8 weeks, meaning that you need to plan some flexibility for your move-in/move-out date.
As the last month approaches, you will need to apply for your full mortgage, procure home insurance, provide a cashiers check for closing, and perform a final walk-through and you’re ready to close!
And… that’s it! Now you have finally accomplished your dream of being a first time homeowner!
First time homeowners have a daunting task ahead of them, but luckily the market is hot for new home sales, especially real estate in Greenville, SC. If you are looking for new homes for sale in Greenville SC, we invite you to discover the stylish homes from Great Southern Homes. As a home design trendsetter, Great Southern Homes will help you find the ideal home for you and your family.
Ranked the 3rd fastest-growing private builder (Builder Magazine 2017), the 62nd largest builder in the nation (Builder Magazine 2017) and one of SC’s fastest growing companies (SC Biz 2016), Great Southern Homes knows the housing market of the Southeast better than anyone. Since our beginning, Great Southern Homes has built homes on the solid foundation of exceptional quality, industry-leading construction standards and brilliant energy-smart and cost-efficient features. Great Southern Homes currently builds great new homes throughout South Carolina with operations in the Midlands, Greenville/Spartanburg, Charleston, Myrtle Beach/Georgetown, Florence, Sumter and Aiken/Augusta. Visit one of our model homes today, or www.greatsouthernhomes.com for more information.