Uncategorized January 1, 2019

Buying Your First Home

Buying your first home can be exciting and a bit anxiety ridden. Here are a few things to know when you’re ready to start.

Get Preapproved

Many people think that shopping for a mortgage will hurt their credit rating, but it’s much different than taking out a store card or even financing a car. Mortgage lenders can account for the inquiry from other mortgage lenders so it won’t hurt your rating. In fact, your lender can suggest things—sometimes very small things—that will make your credit better. Here are a few other reasons to get preapproved:

  • You’ll know approximately how much house you can buy. Avoid the heartache of falling in love with a house you can’t afford!
  • You’ll have the required preapproval letter. Listing Agents won’t even look at your offer without one!
  • Your lender can help your agent know how much to request in closing cost assistance. Very important not to leave any money on the table by asking for too much!
  • You may be eligible for an assistance program. You may be able to afford a home quicker than you thought!

Set Realistic Goals

Being realistic only means being willing to make concessions. A dedicated agent understands that you will need to shop a few properties in order to prioritize your list of features into the “must have” and the “would be nice” lists.

Select the Right Agent

Make sure you find an agent who is accessible, communicates well with you and makes your best interest a priority. She or he should be able to do the following:

  • Explain the process (repeating as often as necessary)
  • Explain the documents
  • Structure your offer to best meet your goals
  • Provide suggestions for professionals
  • Keep track of and communicate important dates
  • Communicate with you regularly

Get a Professional Inspection

Professional Inspectors are not only trained in what to look for but also have the experience to anticipate problems with a potential property. After looking at a bunch of properties, or getting starry-eyed over that one house, it can be easy to miss details that the professional is trained to see. It’s definitely money well spent.

Prepare for a Few Upfront Costs*

  • Earnest Money: Usually about 1% of the Sales Price and will be applied towards the purchase.
  • Option Fee: Usually about $100 depending on the length of the Option Period. This fee can be forfeited if the buyer leaves the contract before the Option Period is over, or it can be applied towards the purchase.
  • Inspection Report: This varies by the size of the property. Plan on at least $350.
  • Appraisal Fee: This charge comes through the buyer’s lender. Some lenders charge for it at the time of the appraisal and some make it part of the closing costs. Plan on at least $500.
  • Specialized Professionals: Sometimes a home inspector will suggest getting an AC professional, a roofer, or some other tradesman to give an opinion.
  • Other costs, such as for a survey, can usually be rolled up into the buyer’s closing costs.


*Earnest Money, Option Fee, and Option Period will be discussed in a later blog post.