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9 Things Every First-Time Home Buyer Should Consider

Buying your first home is no cakewalk. But with the right blend of prep work and help from professionals, you can make the process rather smooth. While it may seem as simple as getting together a down payment, finding the perfect house, and signing the papers, buying your first home involves a lot more than that. There are hidden fees, countless options to narrow down, and lots of future goals to keep in mind. Here are just nine things every first-time home buyer should consider to help the process go a little more smoothly.

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1. Saving Up For Your Downpayment, and More

The most obvious piece of advice, but also one of the most important, is to make sure you save up enough money before you buy a home. If you put down less than 20 percent upfront, you’ll need to obtain Private Mortgage Insurance, or PMI, to satisfy the lender. if you can avoid it by saving up enough, do it.

You’ll need more than just a down payment saved up, though. You’ll also have to cover broker fees and closing costs. Fortunately, you may be eligible for assistance coming up with these funds.

2. Find Out How Much You Can Afford

While you’re saving up a down payment and dreaming of leaving the old rental behind, you’ll have to figure out how much you can actually afford to pay each month towards your mortgage. There are some handy calculators out there, like this one, that can help you figure out how much your monthly costs will amount to. There’s insurance, interest, potential homeowners’ association fees, utilities, and unexpected costs, like a leaky roof or replacing a furnace, to factor in.

3. Consider Your Future

Before you start seriously considering houses, you should ask yourself where you see yourself in two, five, and 10 years. The type of house you buy will depend on those answers. If you don’t plan on having children in the near future and enjoy a simple but urban life, a condo is probably what you're looking for. If you’re looking to have a family in the next few years, you’ll want to find a house that can accommodate that growth down the line so you don’t have to sell and move, which can wind up costing you money. As a general rule, you’ll want to make sure you live in the house you’re buying for five years to avoid a financial hit.

4. Decide What Type of Home You Want

Looking for a unique but low-maintenance and convenient home? Again, a condo is probably your best bet. Condo fees may seem like they add to your monthly costs, but when you factor in that you aren’t paying individually for things like lawn care and exterior maintenance, combined with the fact that many condos come with on-site amenities, those fees start to seem a lot more reasonable.

On the other hand, if you’re looking for a more something more traditional and private — like your own nice backyard — a detached home or perhaps a duplex is more what you’re looking for. Weigh the pros and cons realistically against your lifestyle and goals, and identify which type of home best suits your needs before you get started.

5. Find Your Neighborhood

Just like what type of home you want, you’ll want to decide what type of neighborhood you’d like to live in. This will be influenced by your budget, preferences, and future plans. Some neighborhoods will be better for selling your house down the line, while others will be better if you’re looking to settle in for a while. Make sure to scope out the neighborhood’s character, calculate your commute to work, and factor those into your decision.

6. Work With a Real Estate Agent You Trust

Finding someone to help you navigate your first home buying experience is crucial to minimizing your stress and maximizing what you get out of your purchase. It’s essential, then, to find an agent you click with from the start. Your agent should be someone with experience in the area where you’re looking to buy.

Don’t be afraid to shop around for an agent, either. It’s perfectly fair to ask for references, talk to multiple candidates, and take your time to get to know the person who’s going to be handling what is likely the biggest purchase you’ve ever made in your life.

7. Know Your Needs, Wants, and Don’t-Wants

You may know what type of home and neighborhood you’d prefer to live in, but when it comes down to it, you can’t always get what you want. Work with your real estate agent to create a list of priorities based on your needs, wants, and don’t-wants, and measure potential properties against those factors. While a clawfoot tub would be nice, it’s probably not in the need category. You may have to settle for things like carpeting, weird paint colors, or old siding if you opt for something cheaper, while if you decide it’s in your budget, you might wind up with a perfect turnkey unit that requires few to no changes to make it your dream home.

8. The Home Inspection

No matter how handy you, your partner, or your dad happens to be, don’t skip an official, independent home inspection. You never know what you’ll miss in the excitement of the moment, and it could very well come back to bite you. Every home, from the most modern condo to the oldest heritage home, needs to be fully inspected to make sure everything from the pipes to the windows to the walls is in safe, working order. If an inspection finds issues with the house, you can often take back your offer and negotiate a lower price, or ask for the seller to cover some of those costs.

9. Negotiate

So you’ve found your perfect home. Don’t be so excited that you forget to negotiate. You may be willing to pay that high price tag, but it doesn’t mean you should. Depending on the market, the seller may be willing to cover closing costs, pay for repairs, or bargain with you simply to get rid of it. Your real estate agent can help you decide how much to offer in the first place, and navigate some of those negotiations.

Whether you wind up with a brand-spanking-new condo in the middle of Las Vegas or an older home in a suburb, buying your first home should be a special experience. Following some of these tips can help keep you on track towards finding that perfect space, while avoiding some of the troubles typical of the home-buying experience.

Whatever you do, make sure to do your own research to find out what you really want, find a reliable real estate agent, and work with a professional inspector to get the most out of your first home purchase.

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