Buying a home is one of the biggest decisions you will make as an adult. There are many variables to consider. We have provided a guideline for buying a home to help in this process. Especially buying a house in Las Vegas in 2018, old advice may not still apply.
It’s important to get the most recent information and also focus on what’s important to you. And before you start house shopping, you should get your financing in place. Once you’ve got your need list, consider taking it with you when you begin to look at houses. It’s good to keep notes about each house.
6 Tips Before Buying a Home
Attend a First-time Home Buyer’s Seminar
Not only will you be around other first time home buyers, so you realize you are not the only one that may be a little lost, but at these seminars, you will be in a growth environment with others looking for answers just like you. This is great, as often we don’t know what questions to ask when being a first-time buyer.
Also, most of these seminars are free. In the scope of life, you had to study and take classes for all other adult life commitments, i.e driving, your job, and getting married. The point is you had to study and learn these things, so why not give the mental attention to buying a home. Making the wrong decision on your first house can be completely detrimental to the trajectory of your financial life, so why not take time to learn from people.
Improve your credit score and start saving
Typically a higher credit score could potentially get you the best deals. A score of 700 to 720 will get you a good deal, and 750 and above will garner the best rates on the market. You can start by getting your credit score today with free credit report. It would be best to pause applying for new credit a year prior to applying for a mortgage.
Building up your savings, not just for a home, is very important. Your lender wants to know that you’re not living paycheck to paycheck. If you have three to five months’ worth of mortgage payments set aside, you’re a much better loan candidate. Some lenders and backers, like the FHA, will give you more latitude on other criteria if they see that you have a cash cushion. Your credit history and loan terms help determine how much you’ll need to come up with.
A good rule of thumb is to assume that you’ll spend 2.5 to 3 percent of your home’s value each year on upkeep and repairs. If you buy a $250,000 home, aim to save $520 to $625 per month.
Determine a budget and stick to it
We all have a dream home but it may not match our budget. It’s important to be realistic to know what you can afford. Having your finances in check is the foundation for being successful in your home buying journey.
Start by looking at everything you’re spending money on. This is all your fixed expenses and then your variable expenses which include new home-related expenses such as insurance, possibly increased utility bills, taxes, and even the occasional plumber. Variable expenses include the cleaning bill, late night snacks, and every morning coffee run.
Figure out what you have left after you pay all of those bills. That’s what you’ll have left to spend on your monthly mortgage and home expenses.
Look into First-time Home Buyer Programs and Get pre-approved
A first-time home buyer program can get you lower interest rates on loans. They can also with down payments. There was a tax credit that was offered to qualified first-time homebuyers. You may have missed those incentives, but there are still perks out there.
Some banks and governmental organizations offer first-time home buyers who meet certain criteria lower interest rate loans, low down payment options and even down payment assistance programs.
One program for first-time home buyers is the Federal Housing Administration (FHA) loan program. It usually offers smaller down payments and can be more accessible to those without perfect credit. Lenders like to know a little bit about you and have it backed up with facts.
Research Mortgage/ Loans and Comparison shop
It’s not typical to pay all out cash for a house, so taking a loan or mortgage is another option. A mortgage is simply a loan that uses a piece of property, like your new home, as collateral, giving the bank the right to take the home if the person taking out the mortgage doesn’t hold up his or her end of the bargain.
Think about your long-term plan when looking at mortgage options. If you never plan to buy another home, you would look at a 30-year, fixed-rate mortgage. However, a young couple may look at buying a home the first time as a temporary house. So, they would look at an adjustable rate mortgage.
Shopping around is a good idea. Different banks may be able to give you different interest rates or different terms. When doing your shopping, be sure that you’re comparing apples to apples, so ask about the same types of loans, terms, and amounts to get a better understanding of what’s really the best deal for you
Find the Right Real Estate Agent
Make sure to find an experienced real estate agent you can trust. A real estate agent like Tai Iozef. This person will be your confidant and insider to the world of home buying. Finding a real estate agent you can trust and will provide quality advice.
Get referrals from friends and family members. Many real estate agents specialize in certain areas of town or types of property, so ask your prospective agents how many homes they’ve sold in your target area or what type of certifications they hold to see if they fit your needs.
Understand the Offer Process
Once you’ve found the house of your dreams, and you’re ready to start the process, it’s good to understand that negotiation may be part of the offer process. Even though you don’t know the type of offer the seller will accept, keep in mind the following:
- Knowing how long the house has been on the market
- The asking price’s position related to comparable properties in the area
- The number of available comparable properties in the neighborhood can make a difference
You don’t want to be bound to purchase a home if you don’t have enough money. You also don’t want to purchase a home that has a cracked foundation or some other deal breaker without having the option to go back to the negotiation table.
When in the home stretch, leave time to request from your real estate agent or mortgage broker, all copies of any documents to preview before the actual closing date. This will help if you are feeling anxious prior to commitment days.
Also don’t be afraid to speak up. If there is something unclear, ask. If it eases your anxiety (and you have the cash flow) you may hire a lawyer to help a closing process and explain any legal jargon in layman’s terms.
Others bring along a parent or trusted friend who’s already gone through a closing process, with them. Buying a home is a big leap, but doing your research and involving the right people can make your home buying experience one that will soon have you saying “Home Sweet Home” with a smile.
The Best Neighborhoods in Las Vegas from the Best Las Vegas Real Estate Agent
Buying a home is a huge investment, probably the most significant purchase of your life. It’s not something you should do without preparation. Before you start on the road to homeownership, make sure you are ready.