Buying a house for the 1st time? Here are a few tips for a smooth deal

Buying a house for the 1st time? Here are a few tips for a smooth deal

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Buying your first home is one of the most exciting milestones in adult life. Whether you are in your 20s or your 40s, the excitement of this purchase can be overwhelming, making it easy to forget all the “extras” that come with first time homeownership. If you are getting ready to take the leap towards homeownership, here are 10 important things to remember.

Nobody likes budgeting, but before purchasing your first home, it is imperative that this be one of your top priorities. When considering what you can comfortably afford for monthly payments, don’t forget to include expenses like utilities, homeowner’s insurance, property taxes, HOA or condo association dues, and ongoing maintenance costs.

While the market isn’t as hot as it was in 2020 and 2021, houses are still selling fast, and buyers need to be ready to present strong and attractive offers. By getting pre-approved, you will know exactly what you can afford and what homes are in your price range. Getting pre-approved will give you the confidence and ability to submit a stronger offer when you find your home-sweet- home. The pre-approved process is easy and can typically be done online directly through a lender or a mortgage broker and is typically granted within three to five business days.

Here in beautiful Florida, it can be difficult to decide where to live. By researching things like school districts, walkability, safety, neighborhood characteristics, and property value trends, you will gain a better sense of where you would like to call home.

Building a strong relationship with a qualified and trusted Realtor is one of the best connections you can make. Realtors are experts on their communities and can help guide you through the home-buying process. From contract negotiations to navigating the home-buying process, Realtors have your back. An experienced Realtor is also a great referral source for things like movers, plumbers, insurance agents, roofing companies, and more!

In addition to the initial escrow deposit on a property, closing costs are a huge financial obligation that often get overlooked. Closing closes include things like inspection fees, lender or mortgage broker commissions, appraisals, legal fees, title company fees, and more. As a general guideline, industry professionals say you can expect to pay 6%-8% of the overall purchase price for closing costs. This means that when purchasing a home for $350,000, you can expect to pay between $21,000-$28,000 in closing costs. While this number isn’t set in stone, it can give you a ballpark idea of what addition fees to budget for closing day.

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First-time homeownership often comes with additional expenses such as purchasing furniture, dishes, stocking your pantry, paying for mail forwarding for three to six months, obtaining updated IDs with your new address, and more. Making sure you can afford these initial expenses will make decorating your space more fun and less stressful.

Are you on the market for a bachelor pad, a starter home, or a home where you can grow your family? Will this be your primary residence for the foreseeable future, or is this purchase part of a long-term investment strategy? Unlike renting, where you have the flexibility to move at your leisure, buying a home is a semi-permanent decision. Assessing your immediate needs and long- term housing goals will help you determine what type of property suits your needs.

Unexpected expenses like burst pipes, roof replacements and HOA special assessments are major financial and emotional drawbacks to homeownership. These expenses are often hard to see coming and usually hit at the most inconvenient of times. Most financial advisors suggest that having a safety net great enough to cover three to six months’ worth of known expenses is a necessary part of homeownership. Setting aside emergency or reserve funds may seem unnecessary when your financials are in order, but these savings are essential to keeping you afloat if you change jobs, have an emergency, or go through unexpected financial hardship.

When preparing to purchase your largest investment, the saying “Location, location, location” is vital to remember. Aside from deciding what city or neighborhood you want to live in, it is important to consider whether you want to live in a community with a bomeowners or condominium association, whether the overseeing association is relaxed or restrictive, whether the property taxes in a particular part of the community are affordable, and whether you can see yourself fitting in to you surrounding community now and in the years to come.

In the state of Florida, you have two options for who handles your closing: a title company or an attorney. While closing with a title company is an option, having an attorney handle your closing has significant benefits at comparable costs. In addition to having an attorney prepare and review your closing documents, attorneys are masters of their trade and can handle title issues with ease as they arise. Having an attorney handle your closing from start to finish will save you time and stress, not to mention possible financial savings. If you decide to close with a title company, know that it is also an option to have a real estate attorney review your closing documents prior to signing. Having a trained pair of eyes either to prepare or review your documents is one of the most invaluable investments you can make towards your homebuying dreams.

Homeownership is a huge milestone to celebrate, and what better way to celebrate than by giving yourself an early housewarming gift of peace of mind. Working with a trusted Realtor, financial advisor and attorney can save you time and money, in the short term and long term. You’re still in the early stages of planning or getting ready to put in an offer on your dream home, working with the right team of professionals can the stress out of homebuying and allow you to enjoy the process knowing your best interests are protected.

Stephen J. Lacey, JD, LLM, is a member of the law firm Lacey Lyons Rezanka. His practice areas focus on estate planning and probate.

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