Ask Away Blog: Tips for First Time Home Buyers

Tips for First Time Home Buyers

Thursday, December 5, 2019


So you’re sick of renting and it’s time to buy a house but you’re nervous because let’s be honest, you’re on a low income and the housing market and the entire home buying process is extremely overwhelming. Here are some tips for first time home buyers to help you along the way.

Make sure you start saving sooner than later.

Start putting any money aside that you can, even if it’s just $50 a paycheck. Anything is better than nothing, and there are always expenses in the beginning whether it’s with closing costs or it’s having to buy some necessities for the house once you move in.

Look into low income housing programs.

There are plenty of programs out there like the Chenoa Fund, that can help you afford a home even on a low income. Don’t be afraid to ask around and reach out to get more information before you decide to commit.

Know what you can realistically afford.

The term house poor is when you can barely afford to get by each month because your mortgage payment is SO big. Buy reasonably with a home that’s the right size for you and that has a monthly mortgage payment that doesn’t make you want to cry.

Make sure you check your credit in the beginning.

Know what your credit score is before you have a potential lender pull it, so there are no surprises. And if you have time, work on getting your credit score higher for when home shopping comes around.

Compare mortgage rates.

Do your research with different lenders to see what their rates are and the possibility for discount points. Make sure the real estate agent you decide to work with helps you with this if you need it.

Choose a realtor you trust.

Ask friends and family who they’ve used and check out the reviews online. This person is helping guide you with making a HUGE decision in your life so make sure you are working with someone you’re 100% satisfied with.

Get pre-qualified.

This is when a lender gives you an estimate of how much they would be willing to lend you based on your income and debts. However, don’t just jump at the figure they give you and get set on it. Remember, they want you to be in debt. Opt for something you can definitely afford and settle on that figure.

Remember, you can’t change location.

Even if the house isn’t your dream home (remember, you can always make improvements), make sure you LOVE the location. You can NOT change location in any way shape or form so make sure you absolutely love the area, the neighborhood, and the possible commute to work you will have.

Don’t forget about closing costs.

There are always closing costs when buying a home and they are usually 2-5% of your loan amount. This is also why I said to save up money in advance. There are ways to calculate closing costs so work with your lender to figure that out. You can also ask the seller to pay for a portion of the costs if they are willing to do so.

Hopefully you’re ready to take on the next chapter of your life. Homeownership is a great feeling.

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