Buying your first home is exciting, but it can also be intimidating. If you ask a dozen people what they wished they had known ahead of time, you may get dozens of different answers.
The Feagles Home Team Real Estate in New Jersey knows all too well the feelings that come with buying your first home and subsequent properties. So, let's look at some universal things people wish they had known or been told before they started shopping for their first home.
Everything you should know before buying your first home
Hire your own agent
When you decide you want to start shopping for homes, one instinct is to start searching the internet. It is okay to look around, but you should avoid starting any serious search without having your own agent.
Do not call a listing agent regarding a Ridgewood home for sale or anywhere else. Why? The listing agent was hired by and works for the seller. Their first allegiance goes to them. You need a realtor who will work for you with your best interests at heart. And, yes, you do need a realtor.
If you are concerned about what a realtor might cost, know that the seller pays commissions for both their listing agent and the buyer's agent. Reasons you need a buyer's agent include:
-
Locating homes that fit your needs and your budget
-
Knowledge of the neighborhood
-
Negotiating an offer
-
Understanding the home inspection and negotiating repairs or credits
-
Reviewing necessary disclosures
-
Filling out and filing the paperwork
Many of the issues regarding purchasing a home are complex. You need an expert to help you navigate them.
Get a mortgage pre approval
You need to know how much you can spend before you try to spend it. There is no point in shopping for more than you can afford. Some lenders offer a pre-qualification, which does not tell you anything except that they are willing to look into a preapproval for you. Ignore a pre-qualification and get pre-approved.
Your pre approval tells you exactly what a lender will agree to lend you. It will also let your realtor and a seller's agent know how serious you are about a property. Some selling agents will not show a home to someone who has not been pre approved.
Choose your mortgage lender
Do not be afraid to mortgage shop. Even if one lender pre approved you, that does not mean you have to go with them. Shop for the best interest rates and terms available to you.
In addition, after meeting with a potential lender, you should come away with a feeling of trust. You want someone responsive and who will move quickly once you make an offer on your potential home.
Understand potential costs and prepare ahead of time
To purchase a home, you will not only need a home loan, but finances for a down payment, closing costs, possible repairs, moving expenses, and an emergency fund.
In New Jersey, the average down payment for a house is 10%, according to NJ Lenders Corp. Sometimes, even a smaller down payment is possible. You should discuss this with your realtor and lenders as you shop around for your mortgage.
Your mortgage payment includes the principal, interest, taxes, and insurance. That payment should be less than 28% of your monthly income. This is likely what your lender based on the amount you were approved.
In addition to a monthly mortgage, you will have other carrying costs, including homeowner's insurance and taxes. And you need an emergency budget. While many recommend $2,000-$3,000, the more you can keep in your emergency fund, the better.
What you must have and what you can live without
Before you shop, decide what you really want and what might be nice but you can live without. If you love to cook, you may want to ensure the kitchen is ready for you to dig right in. Or, could an okay kitchen do for now, with the realization you can have a kitchen redone to your own specs in the future?
If you are young, maybe you want a room that could be turned into a nursery and, later, a bedroom. This and having a guest room could mean looking for a three-bedroom house.
You should look for the right size house to meet your needs. Many home buyers later regret not having purchased a larger house. Some wish their home were smaller.
Bring someone along
Take a family member or friend who is not directly involved in your search along for a tour. When looking, we get blinded by really liking a home and may miss problem issues. Beware of a home flipper who may tend to pretty up a home without attending to bigger issues. Before you get too excited, have a less invested set of eyes look around.
Never forgo the home inspection
No matter how new the home is or how perfect it looks, do not pass on an independent home inspection before you make an offer. A home inspector should look at all aspects of a house, from the foundation and structural integrity to the heating and air unit and appliances.
Why inspect a new home? Maybe corners were cut to get the house available and on the market quickly. Or, with several workers on a job, it is possible something was simply overlooked.
Do not be afraid to ask to be there during the inspection. You should be able to attend to all of the inspection processes and ask about potential problems as the inspector points them out.
Be sure the sewer lines are scoped for tree root interference or aging pipes and if the home inspector does not do roofs, have a separate roof inspection.
You should also receive a copy of the inspection report that you and your realtor should thoroughly read. The home seller may not be willing to do repairs, which can be okay if you ask for an appropriate price reduction so you can have them done yourself. What you want to avoid is a major problem that should be identified before you purchase the house.
Not investing in a home warranty
It is not unusual to ask for a little extra security from the seller and see if they will pay for your first year of a home warranty. A home warranty should cover issues such as:
-
Heating and air conditioning
-
Water heaters
-
Plumbing system
-
Electrical system
-
Major appliances including the stove, dishwasher, washing machine, and dryer
If the seller will not pay for one, you should invest in a home warranty yourself.
Do not skip a final walk-through
Some properties close quickly. Others not so much. But once any necessary repairs are done, and you are about to become a homeowner, you should make another trip through the house with your realtor to assure upgrades were done correctly, no repairs were skipped, and no recent problems have arisen. While you might think all is well, it is better to make sure.
Consider “location, location, location”
You have heard this repeatedly. After all, it is the realtor's mantra. And while it is essential for the resale of any home, it can also be necessary on a personal level.
For those with children, a desirable school district is essential. But even if you do not have children, this could mean an area of lower crime rate and certainly will affect the resale value in the future.
Consider carefully how long a commute from your potential new home is to work daily. You may think you are willing to drive further for a house you want, but how happy will you be about it a year later when you are sitting in traffic wishing you were home already?
Consider, too, the possibility of future development around what could be your new home. You may feel the house is out in the wide-open spaces, only to discover a couple of years of a new development coming in and crowding the neighborhood. Good realtors stay connected with these types of information, and while a selling agent may not disclose this type of fact, your own realtor should.
Partner with a Feagles Home Team agent today
Purchasing a home is a considerable investment. Buying any home can be electrifying and trying at the same time. Investing in your first home can be daunting.
You can trust a member of the Feagles Home Team of New Jersey to guide you through the things a first-time homebuyer needs to know. Jeff, Blake, and Zachary work closely with each other to best meet the needs of their clients. They will work hard for you to find you your best home in Ramsey, Wyckoff, Ridgewood, and the area surrounding them.
Whether you are a first-time buyer or a seasoned investor, let the Feagles Home Team help you find the property of your dreams.
