Valuable Insider Tips For First Time Home Buyers
Part 1 of 2
The holiday season is over; old man winter will soon go back to sleep, and spring is right around the corner. That means the real estate market is about to heat up. A great deal of first time homebuyers are getting excited to begin the search phase of the process. Although this is a fun and exciting time in your life, you need to be aware of the fact that there are a plethora of issues that need to be dealt with properly. Otherwise, you could end up losing out on the perfect property, or even end up purchasing a house that is not exactly right for you.
The good news is that working with a qualified Realtor that specializes in representing first time homebuyers will certainly go a long way in helping you succeed. In addition, your real estate agent will also prepare you for life as a homeowner and inform you about all of the responsibilities that go along with that privilege. Buying a home is the largest purchase that most people make in their lives. Being properly prepared for that takes a significant amount of stress out of the equation. So without further ado, the following information will provide you with a few valuable insider tips for first time homebuyers.
It Typically Takes 45-60 Days To Close On A Property
The process of purchasing residential real estate can be a lengthy one, and you need to stay patient at all times. It all begins with the search phase, which is different for every buyer. In essence, you may see the perfect home on your first showing, or it could take dozens, or more showings before you see a property that you are interested in purchasing. Once you do find a home that you would like to buy, the next step to make a formal offer. Your Realtor will help you with the process of making an offer. It should be noted that prior to making any offers you should be pre-approved for a mortgage with a bank or lender.
The seller can accept the offer, counter offer, or reject the offer. In essence, this is negotiation phase of the process. If the buyer and seller agree to a purchase price, it typically takes 45-60 days to close on the property, meaning your mortgage loan will close within 45-60 days. At that point, you are the new owner of the property and can move in at any time. Please keep in mind that if you are purchasing a foreclosure, short sale, or rehab property, it can take significantly longer for the loan to close.
Start Saving For The Down Payment
The vast majority of homebuyers, particularly first time homebuyers, cannot afford to pay for the purchase in cash. That means you will need to take out a mortgage with a bank or lender in order to buy the house. Most banks and lenders require a down payment, as they will not finance 100% of the deal. Although it is common to put down 20% of the purchase price, there are first time home buyer programs that require as little as a 3% down payment. Either way, you need to be prepared with the down payment ahead of time because even a small down payment can be a large amount of money.
For example, a 3% down payment on a $350,000 property is $10,500. That is a significant amount of money for most people. In most cases, you will need to prove to the lender that the down payment funds are not only available, but have been in your accounts for a specific period of time. That means you may not be allowed to borrow the money for the down payment from family or friends. Saving $10,500 for the down payment can be difficult to say the least. It is always a good idea to set aside any large amounts of cash that come in such as work bonuses and tax refunds.
To Be Continued….
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