Knowledge is Power: Taking the Fear out of First-Time Home Buying

Buying your first home is a roller coaster of emotions. Inexperience, excitement, trepidation, elation and a whole host of feelings are wrapped up into a single experience. Let’s consider some essential tips to making the right moves as a new buyer.

First, consider whether it’s the right time for you to buy a house. Do you have a stable job? Are you likely to remain in the same city for at least a few years or do you expect to be moving soon? Unless the housing market where you live is experiencing considerable appreciation over short time periods, it’s best to buy when you can expect to live in the house at least long enough to experience some upward movement in the value of the property. Exceptions might include housing that can be improved through repair or renovations that you have the skills and ability to perform yourself.

It may be beneficial to use a “rent or buy” calculator. After entering your general financial information, the program will give you a recommendation on whether entering the housing market would be a good idea, given your situation and aspirations. You can try the calculator at http://realestate.aol.com/home-buying/learn or go to http://www.iwon.com and check out their Real Estate section and use the “Rent vs. Buy” link under “Real Estate Tools”.

Second, if you check out as a potential home buyer, the next step should be to determine just how much money you would have to work with by becoming pre-qualified for a home loan. Select one or two lenders and consult with them regarding your likely maximum loan amount. Now you will know just what sort of homes are within your reach, instead of finding your “dream home” and later being disappointed with realizing it’s beyond your means.

Third, select a trustworthy real estate agent that makes you feel comfortable. In your home search, you may spend considerable time with this individual and likely the largest purchase of your life up to this point is going to be guided by this person. It doesn’t hurt to visit a few agents before making your choice or consulting with other homebuyers and asking them for references.

Do not rush into a purchase. Take the time to do the necessary research on your finances and your choice of agent. In the future we will consider steps to take in home selection and what to remember when you “close the deal.”