SPECIAL SECTION:
Real Estate
WHAT FIRST-TIME HOMEBUYERS
SHOULD KNOW
Last year was a great year for new homebuyers. According
to the National Association of Realtors, about 35 percent of the
homebuying market was made up of first-time buyers. Yet, each
year is not created equally in the mortgage industry and real estate
market. Changes happen frequently and it is often hard to keep up. If you’re
looking to break into real estate for the first time, here are some insights into how
to navigate the market.
Saving. Step number one for a first-time homebuyer should always be saving.
Take a look at your current finances. It’s recommended that your mortgage
payment not exceed 30 percent of your gross monthly income. See where you
can cut back spending to put away a little extra out of your paycheck every
month for your new home. Not only can this cash go toward a down payment,
but most likely you’ll need furniture, appliances, and decorations to furnish
your new home. Don’t just calculate the amount of money needed for a down
payment. Keep in mind the unforeseen expenses such as home repairs, agent fees
and closing costs. You can never save too much!
1. Mortgage. Applying for a mortgage can be an intimidating process, but
if you prepare accordingly, you’ll be happy with the outcome. According
to LendingTree.com, mortgage lenders are allowing higher debt levels for
borrowers with lower down payments (as little as 3 percent on a conventional
mortgage loan). You may not need the typical 20 percent down that was
required of homebuyers a few decades ago. If your debt-to-income ratio is
high, you may not have to worry. Mortgage companies are making it easier for
borrowers with more debt to still qualify.
2. Agent. Having a real estate agent in your corner for a first-time purchase is key.
Agents will not only help you navigate the home-buying process, but can also
be a valuable resource for an inside look at new homes that go on the market.
This gives buyers the opportunity to view homes that may not have made it
onto real estate websites for public viewing.
3. Location. Your dream house may not be in your dream location, and your
dream location may not have your dream house. Don’t get stuck in a rut if
you’re not seeing everything you want in your price range. Typically, you’ll need
to make some compromises with your first home. Keep a few non-negotiables
in your back pocket, but otherwise be open to the idea of putting some of your
own upgrades and changes into a home that may not have everything on your
wish list.
4. Home. Don’t get stuck in the mindset that you should spend every dollar that
you qualify for in your mortgage. This could lead to bigger problems down the
road. Look in the market under your max budget and be creative when looking
at homes for ways to make improvements or changes that better fit your needs.
A little bit of sweat equity can go a long way and will give the home your own
personal touch.
5. Offer. Once you’ve found a house you want to call “home,” work with your real
estate agent to come up with an offer the seller can’t refuse. Whether the house
needs some improvements or it’s a hot buy on the market, your agent can
guide you into making a serious offer to the seller. If you’re feeling passionate
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CANON-MAC
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SUMMER 2019
39