Deciding to buy your first home is a huge accomplishment, congrats! Now that you’ve made this big commitment there’s a few choices that can make the process easier. While it may seem a bit scary, we’re here to provide you with some insight on how to do it right.
We’ve put together a small list of things to consider when purchasing your first home and finally turn your dreams into reality!
Get Your Finances in Check
One of the biggest challenges that millennial home buyers face is student loan debt. A recent study by Experian shows that the average student loan debt per graduate was $35,000. Not to mention, millennials typically also have car loans, as well as credit card debt bogging them down. Buying a house is a huge financial commitment and you’ll want to make sure you have your debt under control before you plan to buy.
Most millennials don’t have a large pile of cash laying around, however over time, saving enough for a down payment is achievable. Depending on your credit, many banks and lenders are currently offering low credit rates.. The standard down payment is about 20% of the total home cost, but could be as low as 5% but some government loans are only requiring as low as 3.5% down.
Find a Realtor
Trust us on this, find a real estate agent to help you. Since this is your first time buying a home, it is probably not a good idea to try to do everything on your own. Using a trustworthy and credible realtor can save you a lot of time and can provide you with knowledge of the market in the area you are looking to live in.
Close the Deal
Once you think you have found your dream home, it’s time to make an offer. Making an offer is straight forward, but it can go three different ways: Yes, No, or a Counteroffer. This is another reason it’s good to have a real estate agent, they can do all of the tricky negotiations on your behalf…phew! After everything has been settled and your offer is accepted, you generally have 60 days to get a home inspection, get the home appraised, and to get your mortgage figured out.
Protect Your New Home
You just placed an offer on the home of your dreams, now you’ll need to think about how to keep that home protected in the unfortunate event that something bad happens. Mortgage lenders require all homeowners to have homeowners insurance.
The reason it is important to ensure you have the correct coverage comes into play if or when you experience a claim. Overlapping coverage does not mean you have double protection nor does it mean that there are not gaps in coverage, it just means that when there is a claim it could get more complicated than it needs to be. And who wants to add more stress to an already stressful situation?