First-Time Homebuyers: What to Expect
Buying your own home is a part of the American dream, something to strive for. But the home-purchasing process can sometimes seem intimidating for first-time buyers, with so much to think about and consider. But first-time homebuyers actually enjoy a number of benefits that work in their favor during the process. With a little bit of research and the right help, there’s no reason why your search for a first home can’t lead to an outstanding result. To help get you started, here’s a look at what to expect as a first-time homebuyer, as well as a few tips to ensure you end up with the perfect property. Before Your Search Begins Prior to looking at properties, first-time homebuyers should do two specific things. First, get into the right mindset. Your search for a home may move fast, but it’s likely your search takes a few weeks or months — especially in a seller’s market. So make sure you’re focused on the search but also patient. After all, spending time securing the right first home is better than moving too fast and ending up in a house that’s only so-so. Second, make the right preparations. For example, you should get a preapproval from a lender, which gives any offer you make added authority and attractiveness. You should also prepare by thinking through how much you can afford to spend. You’ll be paying principal and interest, of course, but there are also taxes, insurance, maintenance, repairs and other expenses to consider. The last thing you want to do is overspend on a home and find that it’s hard to keep up with monthly costs. The other important preparation is finding the right real estate agent. You need a professional who knows the local market and who is familiar with the neighborhoods you’re interested in. Don’t skip representation due to cost either: Agent commissions almost always come out of the seller’s proceeds, so first-time homebuyers don’t actually pay for an agent. During Your Search This is where mindset is so important. During your actual search, you’re going to look at a lot of online listings. You’ll see your favorite options in-person and you may even visit a few open houses. It’s helpful to have a list of must-haves and nice-to-haves to help guide your search for a home, which narrows down your options to a more manageable number. Also, you may make an offer on a home you love — only to find out that someone else offered more or that someone else offered all cash. There’s often disappointment during the home search process, but with disappointment also comes opportunity. Many times buyers fail to get the house they think they want only to find something even better that comes on the market days later. If you’re lucky, your search for a first home may take just a few days. But it’s more likely to take longer, and you’re probably going to face some disappointment along the way. Just don’t get discouraged. After Your Search There’s nothing quite like finding that perfect property and having your offer accepted by the seller, but the work isn’t quite finished even though your search is over. Although not required by law, you’re going to want an inspection of the home. Almost all buyers pay out of pocket for an inspection because it’s their one chance to have a professional evaluate the home inside and out. In the days and weeks after the acceptance of your offer, you’ll also finalize your loan. It’s OK to shop around for the best rates and best terms to meet your needs. Your lender will also setup an appraisal, which ensures that you’re not paying more than the home is worth. Why is this important? Because the property is collateral for your mortgage, and lenders want to make sure the home can be liquidated to pay off the debt, if needed. Assuming you secure the financing you need, and assuming the inspection and appraisal come back without red flags, you’ll be ready for a closing date. There will be lots of paperwork to sign and sort through, but, at the end of the process, you’ll have keys to your first-ever home. 3 Tips for First-Time Homebuyers This may sound like a lot to take in, but remember that people are buying and selling homes in the Chicago area each day. If they can do it, so can you. Just follow these 3 tips for finding success as a first-time buyer. • Get the Help You Need: Having a good real estate agent makes all the difference. A good real estate agent is closing home transactions on a regular basis, which means a wealth of experience to lean on. He or she can also walk you through the process, providing expert guidance at every step. Your agent will handle offers, negotiations, paperwork and much more. • Count the Full Cost of a Home: Make sure you count the full cost of home ownership. As noted above, there’s much more than just principal and interest to consider. A lender will preapprove your loan up to a certain amount, but it’s not always a good idea to max out your financing — you may find that you’re much more comfortable paying a little bit less and saving for future maintenance, repairs or updates. • Be as Patient as Possible: You’re going to find the right house for you. You just have to be patient. Yes, the home-buying process can be short in some instances, but it’s often a little bit longer — and it almost always demands patience. Find Your First Home in Chicago Your search for a first home is much more likely to end in success when you have a talented real estate professional working for you. The KlopasStratton Team includes agents who know the Chicago market inside and out and who are deeply committed to meeting their clients’ needs. Contact us today about getting the representation you need when searching for your first home.