3 Questions Every First Time Home Buyer Needs to Ask

It’s always a good idea for any first time home buyer to go into the home buying process well educated…forewarned is forearmed I always say.

Every First Time Home Buyer Should Ask These Questions:

1. How much House can I Afford?

Janet SimonsThis first question is largely dependent on how large a mortgage (basically, a home loan) you can handle.

Start your research by using a simple mortgage calculator to see whether you can afford to pay the monthly mortgage on the kinds of houses you have in mind. You may even apply for a mortgage at a lender before you start looking for a home. This is called getting pre-approved for a loan; it will tell you exactly how much you can afford and may make the closing process go faster.

But, remember that owning a home involves more than a monthly mortgage. You’ll also have to consider money you’ll need to have at hand when you make an offer, when you close on a home and on a monthly basis after the home is yours.

Payments you may have to make when you submit an offer and at closing include:

Earnest money, usually 1% to 5% of the cost of the house, which you pay as a deposit on the house when you submit your offer. It is your proof that you are a serious buyer

Down payment, usually 10% to 20% of the cost of the house, which you must pay at closing

Mortgage insurance, paid by borrowers making a down payment of less than 20% Closing costs, usually 3% to 4% of the cost of the house, to pay for processing all the paperwork

Don’t forget the day-to-day expenses you may incur once you own that home.

This includes:

  • Utilities
  • Homeowner or condo association dues
  • Property taxes
  • City and/or County taxes

Apply to the old rule – You don’t want to be house rich but pocket poor!

2. Do I have the right Home Loan?

There are a variety of mortgage types available today, each with advantages and disadvantages depending on how long you plan to live in the home, the financial marketplace and your income potential, among other things.

A fixed-rate mortgage is the most common. In a fixed-rate mortgage, your interest rate and payment stay the same for the life of the loan. An adjustable-rate mortgage usually starts out at lower interest rates and lower monthly payments than fixed-rate mortgages, but your rate and monthly payments may rise and fall based on a financial index.

There are also several government mortgage programs available, including FHA mortgages, which are designed to help people who might not otherwise qualify for a loan.

You may also have a choice in loan terms. There are 30-year loans and 15-year loans.

3. Am I Buying for the Future?

House hunting can be both exciting and frustrating. Most home buyers see roughly 15 houses before buying one. To make the search easier and faster, nearly half of all house hunters today begin by browsing for properties on the Internet, using web sites like this one.

Once you know what you want and what you can afford, its time to see the houses for yourself. To help stay focused, bring with you a checklist of things that you’ve decided ahead of time are important qualities of your future home.

This might include:

  • Is there enough room for you to grow in?
  • Is the house structurally sound?
  • Is the house in move-in condition or will it need work?
  • Is it close enough to everyday needs, such as grocery stores, schools, work?
  • Will you feel safe here?
  • Do the appliances that are part of the sale work?
  • Is the yard right for your needs?
  • Do you like the floor plan?
  • Is there enough storage?
  • Will you be happy in this house in winter, summer, spring, fall?
  • You may also want to take some exterior and interior photos of each house you visit so that you can keep track of its pros and cons.

You certainly want to be happy with your new home but try not to get paralysis through analysis…

Knowing these 3 questions to ask yourself before you start your home buying process will certainly make you and your first time home buying experience more enjoyable.


Janet 
SimonsI am passionate about Real Estate and eager to answer all of your real estate questions! Text or Call me at 360-880-2356 or email me directly to ask about Buying, Selling or Investing in today's Real Estate Market - serving Lewis County & Thurston County, WA.

Janet Simons | Certified Residential Specialist | Real Estate Broker
Mountain Valley Real Estate