Home ownership is very important, a home means so much more than a place to rest your head, it is where families are created and wealth is established.
First thing first, education! Start with educating yourself on the process. Google and YouTube are amazing platforms that offer wonderful content for free.
Zing University is one free online course that helps you through the home buying process, step by step.
You want to take advantage of online resources, especially if you aren’t confident in what to do or how to get started. The more you know the less you fear.
So many people feel overwhelmed and assume home ownership is out of their reach, IT IS NOT! There are several programs out there that will help make your first time home buying process less intimidating.
Some of these programs help with down payments and closing costs. These include:
DOWN PAYMENT ASSISTANCE
- DPA Loans: There are a few options available the the DPA. These include, deferred loan payments, second mortgages and loan forgiveness.
- DPA Grants: You may qualify for a DPA grant, which means you would not have to repay the amount you have been awarded.
- Government backed Loans: present less of a risk to the lender, and allow for the home buyer to get a home if they have poor credit or the buyer can be granted a lower down payment.
- Closing Assistance: This can come from a grat or a loan, the same way a buyer can get assistance for a down payment. The seller can also assist with the closing cost on a home, this is called seller concession.
Both the state and the federal government have programs that will help the home buyer with opportunities for assistance in purchasing their home.
FEDERAL FIRST TIME HOME BUYERS PROGRAM
- Homepath Ready Buyer Program
- Government backed loans
- Good Neighbor Next Door
STATE AND LOCAL FIRST TIME HOME BUYERS PROGRAMS
- Neighborhood Assistance Corporation of America (NACA)
- Habitat For Humanity
- Employer Sponsored First Time Home Buyer Programs
At so many levels, there is assistance for you to purchase your home. First start with the research so that you can know what is available to you. This is one step of the process.
Now that you are ready to purchase here are a few more things to think of as you head toward putting in your offer of your first home.
FHA & Conventional
Sellers prefer a conventional loan over a FHA loan. A FHA loan gives the impression that the buyer either had bad credit or little money upfront, this does not mean that this is true, this is just the impression that is given. With a FHA loan there are strict guidelines for inspection of the home.
These repairs will have to be discussed who will front the cost, either the home buyer or the seller. It is important to pay attention to if a listing indicates that that FHA is accepted.
If you find that the conventional route is for you there are programs that are available to you and you might not have to make a full 20% down payment.
Conventional buying unlike FHA leaves a much better impression on the buyer.
WHEN BUYING A HOME THINK, LOCATION LOCATION, LOCATION.
Once you have narrowed down the ‘where’ you will need to keep your eye on the market. Understanding what is going on so that you can get the most for your money.
You can research this for yourself, or you can get with a professional that understands what you are looking for in a home, and will send you information on listings that match what you are looking for.
The same home in one location might be considerably less in another, this is important to know.
GO TAKE A LOOK
This is a process, keep it strictly business, do not get emotionally involved. The first home you fall in love with, might not be the one that you end up with. Go after your dream home, absolutely; however, takes the time to look at multiple homes.
When you enter a home to look at the pictures, look at the space, not how the space is furnished. Stick to the budget! Oftentimes buyers will see a home that might be out of their budget and will jump at it, be patient and keep looking.
If you have to put additional money into a home to make it the one you want, table that home and finish looking at all the listings you like.
Keep running the numbers in your head. The time it will take to commute to work, school, entertainment, family ect.
MAKE YOUR OFFER
The best offer you want to make is the one where you as the home buyer, feel like you’re getting the best deal. This might not always be the case, but you certainly want to feel good about your new home.
Congrats! You’re almost there. Sellers want to know that a buyer is serious, so they will make you put your money where your signature is.
Upon signing the purchasing agreement, you will need to put down a small deposit; this could range from $1,000 to $4,000.
If the home buyer backs out, the deposit is non refundable. If you do decide to go make this your new home, be sure to seek some concessions.
This just means that the seller could be willing to pay some of the closing cost on the home.
Always be willing to negotiate on the price of your home. If you have been paying attention to the market, you will know if there are better deals on homes available to you, and this will give you some negotiating power. Know if it is a buyer’s or seller’s market. You got this!