If you’ve never before bought a home, it may feel like a daunting process. In the hands of a qualified real estate agent, your journey from novice homebuyer to satisfied homeowner can be much easier than you think.
The biggest challenge standing between you and buying your first home might just be your choice of real estate agent
It’s really true – the real estate agent you choose to help guide you through the process of buying your first home can be vital to the success of your transaction… As well as how you will remember the experience.
I’ve worked with many, many first-time homebuyers over the course of my real estate career. In all cases, my clients have been thoroughly satisfied with the way I have held their hands and helped them to find the home of their dreams.
The Process in a Nutshell
Other than selecting the most qualified real estate agent possible, here are the main steps involved in finding and purchasing your first home:
Review your credit report and know your score. The health of your mortgage application is riding on your credit report and score. Even though you can get a free copy of your credit reports for free through annualcreditreport.com, I recommend you spring for a 3 bureau report with scores from myfico.com. The government-mandated free credit report doesn’t give you credit scores. Myfico.com does. And better yet, the scores you will receive are your official FICO scores.
Once you have your credit report and scores, review your credit report for errors, omissions, and accounts you don’t recognize. This will enable you to dispute inaccuracies before prospective lenders pull your credit.
The reason you should get your scores is because each bureau will have a different score for you. Mortgage applications aren’t approved on the strength of a single FICO score, but rather are the weighted average (blend) of your scores from the big 3 bureaus. You should check your scores before applying for credit – if your blended score is below 720 or so you may have trouble securing financing at favorable terms.
Determine how much home you can afford. Based on your expected down payment and home purchase price, you can run numbers based on various scenarios. Don’t forget to factor for expected property taxes and mortgage insurance.
Find the right lender. There are lots of lenders out there, each vying for your business. It is crucial that you work with the best lender for you and your unique situation. If you haven’t begin working with a lender yet (or you’d like to comparison shop) please let me know[link]. I routinely work with a few incredibly responsive, dedicated lenders who specialize in working with first time homebuyers.
Get preapproved. There’s a huge difference between preapproval and prequalification, and many homebuyers confuse the two. Prequalification basically means that your credit profile meets the rough requirements for a mortgage; preapproval is a longer process whereby a lender makes a firm offer of credit. If you have already completed this step, your lender will probably give you a letter, which can be helpful in getting sellers to take your offers seriously.
Look for the perfect home. I know it seems daunting right now but the perfect home for you and your family is out there… waiting for you. It is your real estate agent’s job to help you find it. If you’re ready to browse available listings or want to learn more about how I can help you in the homebuying process, let’s talk.
Listen to your real estate agent’s advice when making offers. Any real estate agent worth his or her salt will offer advice when the time comes to make an offer on the home or homes you like. Listen to this advice. Assuming you’re working with a skilled, competent real estate agent (and if you aren’t, the time to walk away is now) the advice your real estate agent gives can mean the difference between an accepted offer… and an angry rejection. This advice is especially important during the negotiation process.
Choose the right mortgage. You will probably be weighing several mortgage options. This can be a frustrating, confusing process because every mortgage offer is different. Some offers may include those that require points; others will not. The best way to compare mortgage loan products is to compare the total cost of each loan—which takes into consideration all fees, closing costs, and other expenses that will vary from loan to loan. On this basis, you can select the best loan for you based on the factors most important to you.
Prepare for closing. It might seem hard to believe but the time between acceptance of your offer and closing will go by incredibly fast. A lot will be going on behind the scenes—inspections, required paperwork, calls from your lender, etc.
The one constant you should be able to count on during this time is the responsiveness of your real estate agent. I talk regularly with my first time homebuyer clients to make sure they know what is going on at every stage of the process. This is partly to keep people in the loop… and partly to let you know that I’m doing everything possible to keep your first time home purchase on track.
And once you have closed, you can move in and begin the next exciting phase of your life.
Ready to find the home of your dreams? Just fill out this form below and I’ll be in touch right away.