Develop your home wish list. Then, prioritize the features on your list.
Select where you want to live. Compile a list of three or four neighborhoods you'd like to live in, taking into account items such as schools, recreational facilities, area expansion plans, and safety.
Be realistic. It's OK to be picky, but don't be unrealistic with your expectations. There's no such thing as a perfect home. Use your list of priorities as a guide to evaluate each property.
Manage your Finances
Get your finances in order. Review your credit report and be sure you have enough money to cover your down payment and closing costs. Then, talk to a lender and get prequalified for a mortgage. This will save you the heartache of later falling in love with a house you can't afford.
Decide what you can afford. Generally, you can afford a home equal in value to between two and three times your gross income.
Calculate your Costs
Start saving. Do you have enough money saved to qualify for a mortgage and cover your down payment? Ideally, you should have 20 percent of the purchase price saved as a down payment. Also, don't forget to factor in closing costs. Closing costs - including taxes, attorney's fee, and transfer fees average between 2 and 7 percent of the home price.
Calculate the costs of home ownership. This should include property taxes, insurance, maintenance and utilities, and association fees, if applicable.
Determine your mortgage qualifications. How large of mortgage do you qualify for? Also, explore different loan options — such as 30-year or 15-year fixed mortgages or ARMs — and decide what’s best for you.
Get preapproved.Organize all the documentation a lender will need to preapprove you for a loan. You might need W-2 forms, copies of at least one pay stub, account numbers, and copies of two to four months of bank or credit union statements.
Weigh other sources of help with a down payment.Do you qualify for any special mortgage or down payment assistance programs? Check with your state and local government on down payment assistance programs for first-time buyers. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal.
Ask questions. Buyers who don't ask enough questions of their lender sometimes end up missing out on the best deal.
Act quickly. Not acting quickly enough to make a decision could lead to someone else buying the house.
Find the right agent. Select an agent who’s willing to help you through the homebuying process.
Make a strong offer. Make your offer look appealing to a seller so you're guaranteed to get your dream home.
Think about resale. The average first-time buyer only stays in a home for four years.
Don’t ask too many people for opinions. It will drive you crazy. Select one or two people to turn to if you feel you need a second opinion, but be ready to make the final decision on your own.
Decide your moving timeline. When is your lease up? Are you allowed to sublet? How tight is the rental market in your area? All of these factors will help you determine when you should move.
Think long term. Are you looking for a starter house with plans to move up in a few years, or do you hope to stay in this home for a longer period? This decision may dictate what type of home you’ll buy as well as the type of mortgage terms that will best suit you.
Metro Brokers Financial, Inc., 5775-D Glenridge Drive, Suite 200, Atlanta, Ga. 30328 A Georgia Residential Mortgage Licensee # 5892. NMLSR Unique Identifier # 163853. 404-847-2525