When buying a home are you looking for some first time home buyer tips to get started? Below are five awesome tips to save you some frustration.
are some basic tips that most people who are
looking to purchase a home should be aware of. Especially, if its your first time.
Below are some cool mortgage tips to help you as well.
Being a home buyer for the first time 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.
First of all, many people wonder if they should buy a house 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.
But, if your rent is higher than what a mortgage payment would be and the interest rates are good. Don't wait, start the process now.
If you decide to wait, start a savings program for that 20% down payment. Then you will be ready to go for your house. You also don't want to buy a house at one price and then have its value drop significantly--you have just lost a lot of money when that happens.
But if you are ready to buy now and want help with the down payment, investigate what programs or grants are available to help you.
You may even want to consider a program that has a low down payment or can be arranged into a zero down type loan. You're saying to yourself really? Yes, there are program that work that way, but not in every state. You will have to see what your state offers.
But don't be too conservative and wait too long. 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 the house you want to buy 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.
Unless your area is in a market crisis, then prices and rates may be low at the same time. Waiting could cause you to miss this awesome opportunity.
One example I can relate where competition made it harder on the buyer was when I saw a seller's market. That means there are more buyers than houses for sale. The buyer had to go $5,000 over the asking price to get it. He had missed out on 5 other homes earlier because he didn't go high enough on his offer. So he made sure to get the house this time by paying more than it was worth.
When things are a buyers market, that's the best time for you to buy. When is that exactly? That's when there are more houses for sale than buyers. Now you have the best environment to get a steal!
This is actually a mortgage tip. Know your credit. Why do I say that? Your credit scores affect you. They can impact your interest rate as well as your ability to even qualify for a loan.
If you are sure that your credit is not top of the line, you might want to wait and get your credit rating up before applying.
You could be turned down for the loan you need or be forced into a high interest rate otherwise. So take the time to check your credit scores before you start the process. That way you can avoid some frustration.
What's a good score? Usually anything in the 700's gives you the best buying environment. But if prices are low and your credit isn't too low, it might be worth it to go ahead and get the house now.
All in all though, knowing your financial picture, gives you a better idea of buying now or waiting. That's why I like these first time home buyer tips!
If you aren't really sure how much house you can buy, you can get
pre-qualified first 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 in buying a
house or jump into it now. It shouldn't cost you anything to get pre-qualified. Avoid those lenders who want to charge you for this.
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. Applying the above five first time home buyer tips will help you evaluate your personal circumstances.
Below are a couple of mortgage tips to consider:
My wife and I bought one of our houses 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 are looking for more first time home buyer tips, have a question is a cool place to look. If you cannot find the answers your looking for, then this is the place to ask also. Go ahead...pick my brain!
Perhaps you are ready to get started by wonder which loan program would be right for you. Home Buyer Programs page explains the different options making it easier for you to decide.
Are you interested in the FHA product? My FHA Home Loans page explains the various products so you can pick the perfect one for you.
Go to House Buyer Solutions Home Page.
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