First Time Home Buyer TipsHere are some basic first time home buyer tips that most people who are looking to purchase their own home for the first time should be aware of. Being a first time home buyer can put you in a scary and confusing position. Also, because it is so exciting to imagine yourself about to own your own home, you can get some "irrational exuberance" flowing through you and this can lead to making bad decisions. So hopefully these first time home buyer tips will help you keep your head during this whole process. Should I buy now or wait? 
First of all, many people wonder if they should buy a home immediately or, should they wait for prices in an area to go down? This is a tricky question for it depends on a few different variables.
On the one hand, if your current rental living arrangement isn't driving you crazy and you aren't so sure that you can get a standard conforming loan because you don't have at least 20% of the purchase price to put down, then it could be wise for you to wait. Time to save for down payment. This will allow you time to save for that 20% down payment and see if the prices drop. Then you will be ready to go for your house. You also don't want to buy a home at one price and then have its value drop significantly--you have just lost a lot of money when that happens. Waiting can increase competition. But on the other hand there are dangers with this conservative approach, too. Why do retailers run sales? They put products on sale to get more people into their store. When house prices drop, houses are on sale. Now, there are more people who can afford "your" house than there were before. These people are all in direct competition with you. You don't have as much of a chance of getting the very house you wanted as you did before when prices were higher. There's also the fact that as housing prices go down, interest rates go up. Ugh!!! This is because when prices are higher, lenders lower rates to attract more buyers. But when prices drop, lenders raise rates to use competition to get the most qualified borrowers. And the danger here is that interest rates could rise enough, so that you would actually have to pay more money per month on the loan than you would have if you bought at the higher price with a lower interest rate. How is my credit? Another basic first time home buyer tips has to do with credit. If you are sure that your credit is not top of the line, you might want to wait and get your credit rating up. You could be turned down for the loan you need or be forced into a high interest rate. Get pre-qualified for a loan. If you aren't really sure, you can get pre-qualified for loans to see what you could possibly get today. Lenders are happy to pre-qualify you because they hope to earn your business. By doing this it can help you make a decision whether to wait or buy that first home now. You can see the juggling act here. So there is no cut and dry answer to whether the timing is good now or later. You'll have to take a look at your personal circumstances and decide. Here are some more solid first time home buyer tips: My wife and I bought one of our homes this way and truly benefited from the low rates. But because I was in the business, we moved to a fixed rate loan before the mortgage payments started to go up. But remember, I was in the business and could watch it. Not a good idea for you, the first time home buyer. Use these first time home buyer tips to make sure you do things right with your first home purchase. If you would like to leave First Time Home Buyer Tips and return to our First Time Home Buyer Guides main page, click here. Or return to First Time Home Buyers home page.
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