10-Point Checklist for First-Time Homebuyers
For those embarking on the homeownership journey for the first time, the process can be both exciting, and confusing. Whether you build or purchase your new home, however, you deserve to have your first property be a place you love. That is why we have put together this checklist for first-time homebuyers. These 10 steps should help you navigate the process more successfully, so you end up with a home you can take pride in for many years.
✅ Save for a down payment and closing costs
Whether you are looking for a property where you can build your dream home, or searching for a ready-made house to buy, you will want to have money saved for a down payment and closing costs.
A down payment is the money you pay toward your home that reduces the amount you have to borrow. Closing costs are the several thousand dollars you will owe to complete the purchase of your property.
The recommended down payment is 20 percent of the purchase price of the property. However, you can often buy a property with less of a down payment, as long as you pay mortgage insurance (PMI) along with your mortgage every month. Some financing programs also make it possible to purchase a home and with less of a down payment and/or with fewer closing costs.
✅ Find a real estate agent or certified home builder
Because the home buying process can be complicated, you are more likely to succeed with a licensed realtor or home builder on your side. This professional understands the real estate market in your desired area and will work with you to find you the perfect property within your budget. Even though you do not have to work with a realtor or builder, they can offer you the following advantages:
- Access to the most recent MLS listings
- Assistance finding a home that meets your budget and preferences
- Negotiation with the sellers to get you the best deal
- Guidance throughout the process of closing on your new property
- Walk-throughs of potential properties
Here at Ventoni Construction, we don’t just build you a home you can love for a lifetime. We help you find the perfect property where you can build that home, thanks to the help of our licensed realtors, who keep the process simple and focused on what you need.
✅ Check your credit score
When it comes to financing your new home, you will probably need to get a loan, called a mortgage, to pay for the property, and/or homebuilding process. In order to appeal to potential lenders, you will need a credit score of at least 620, unless you qualify for specific programs that allow you to get a mortgage with a lower credit score.
If your score isn’t quite where you want it, consider paying down debt and/or increasing your income before house hunting. Those steps should improve your credit score and make you more attractive to potential lenders.
✅ Get your pre-approval
Before you start viewing potential properties, you will need to know what you can spend. Doing so can help you avoid viewing (And falling in love with) properties you cannot afford. Plus, getting pre-approval from your lender can give you the confidence that you CAN afford the perfect property when you find it.
The pre-approval process is not complicated, but it does require you to work with a reliable lender and turn in a few pieces of information.
A qualified lender can make this process fast and simple so you can start looking at homes right away. Make sure you check with multiple lenders to get the best rates and terms for your loan.
Budgets can feel limiting, but the reality is that with the right real estate agent, and the right builder, a budget can free you up to pursue the affordable home of your dreams. Here at Ventoni Construction, we work with budgets of all sizes to bring your vision to life, on your budget.
✅ Check your eligibility for financing programs
Affording your first home can sometimes be difficult, which is why a number of programs exist to put homeownership within reach for specific groups of people. Before you try to pay for your first property on your own, check your eligibility for these programs. Some of the places you can check include the following:
- FHA Loans
- Homeownership Vouchers
- The Indian Home Loan Guarantee
- HomePath Ready Buyer
✅ Start researching properties
Once you have a real estate agent and pre-approval, you can begin the exciting process of looking for your first home. Your real estate agent will alert you to potential properties that meet your requirements, arrange tours, accompany you on your visits, provide essential information about each property, and answer all of your questions.
Here at Ventoni Construction, we will help you find the right property for your dream home. The site you choose will match your plans for your new home, guide the design of that home, and enhance your enjoyment of your new space.
✅ Put in an offer on your desired property
Once you find a property you love, you will need to put in an offer. This is an amount of money you are willing to pay for the property, and it typically includes the following:
- Earnest money of 1-3 percent of the purchase price
- Purchase price offer
- Terms of the offer (e.g. Repairs, inspections, upgrades, etc.)
- Your pre-approval letter
- Closing costs you are willing to pay
- Deadline for seller response
✅ Be prepared to negotiate
Turning in an offer on a property does not guarantee that you will have the opportunity to buy that property. The sellers have the chance to respond to your offer, and that often leads to negotiations. For example, the seller may offer any of the following responses:
- Accept your offer
- Reject your offer
The give and take the goes into negotiating a purchase offer on a property can be guided by your real estate agent to improve your chances of quickly coming to an agreement with the seller.
✅ Get an appraisal and inspection
Once your offer is accepted, you will want to make sure that your property is worth what you are paying for it through an appraisal, and ensure that the property is in good enough condition through an inspection.
The good news is that even if the appraisal and/or the inspection are not what you had hoped, you have options for remedying the situation. For example, you may be able to lower your offer in light of a low appraisal, or request repairs from the seller if problems show up in the inspection.
✅ Close on your property
Perhaps the most exciting time as a first time homebuyer is closing on your new property. This is the point at which you officially become owners of your new place. Getting together with a closing agent, lender, and real estate agent to sign all the necessary paperwork can be one of the most important times in your life. It is time to celebrate!
If you choose to build instead of purchase a home, you will begin the homebuilding process after you close on your desired property. When you decide to build your home, choose the builder who prioritizes your needs, stays within your budget, and creates a home you can love. Choose Ventoni Construction.
We will help you not just through the process of creating the home of your dreams, we will walk you through the process of finding and purchasing the perfect property for your needs. We look forward to bringing your homebuilding vision to life!