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First Time HomeBuyers

Considering buying your first home?

Are you finally considering getting your first home, but you don't know what to do or where to start? Our team makes sure to provide you with all of the information and knowledge that you need to know about purchasing your first home.

We have the products and programs necessary to get you into your first home. We make sure to partner you with the perfect realtor who can help you find a home perfectly tailored to your needs.

When purchasing your first home, don't assume that you have to put 20% down, or that you have to be in a certain tax bracket. That is not true. With The Bally Team, we offer First Time Home Buyer programs that will allow you to put as little as 3% down towards your new home, so that you can keep some money in your savings account. The last thing you want to do is spend all of the money that you have earned, leaving you with nothing for emergencies, because we all know how quickly things can happen and change.

With these First Time Homebuyer programs, you will not get charged extra, or be placed with a higher interest rate, so don't be worried when considering this option — as this option is one of the most beneficial options we have.

Also, for a limited time, we are reimbursing appraisals for our first time homebuyers (must qualify). This is our way of saying Thank You for doing business with The Bally Team.

Contact us today by phone, in person, or even send us an email. Let us know how we can help you make it a smooth and easy process.

Tips for First Time Home Buyers

Buying a home can be nerve-racking, especially if you’re a first-time home buyer.

These tips will help you navigate through the process, save money, and avoid common mistakes. We organized them into four categories:

Mortgage Down Payment Tips

Mortgage Application Tips

House Shopping Tips

First-Time Home Buyer - Mistakes To Avoid

Mortgage Down Payment Tips

1. Start saving for a down payment early

Saving for the down payment early can really benefit you when it is time to purchase. We provide 3% down payment options, but even on a $250,000 loan, that is still $7,500. 

Prepping early is better than never. 

2. Explore your down payment and mortgage options

There are lots of mortgage options out there, each with their own combination of pros and cons. If you’re struggling to come up with a down payment, check out:

Conventional mortgages that conform to standards set by the government-sponsored entities Fannie Mae and Freddie Mac, and require as little as 3% down.

Federal Housing Administration loans, which permit down payments as low as 3.5%.

Veterans Affairs loans, which sometimes require no down payment at all.

The amount you put down also affects your monthly mortgage payment and interest rate. If you want the smallest mortgage payment possible, opt for a 30-year fixed mortgage. But if you can afford larger monthly payments, you can get a lower interest rate with a 20-year or 15-year fixed loan. Or you may prefer an adjustable-rate mortgage, which is riskier but guarantees a low interest rate for the first few years of your mortgage.

3. Research state and local assistance programs

In addition to federal programs, many states offer assistance programs for first-time home buyers with perks such as down payment assistance, closing cost assistance, tax credits and discounted interest rates. Your county or municipality may also have first-time home buyer programs.

Mortgage Application Tips

4. Determine how much you can afford on a home.

Before you start looking for a home, be sure to contact us so that we can calculate what you can afford on a monthly payment for the home.

5. Check your credit activity and pause any new activity.

When applying for a mortgage loan, your credit will be one of the key factors in whether or not you’re approved, and it will help determine your interest rate and possibly the loan terms.

So check your credit before you begin the home buying process. Dispute any errors that could be dragging down your credit score and look for opportunities to improve your credit, such as making a dent in any outstanding debts.

To keep your score from dipping after you apply for a mortgage, avoid opening any new credit accounts, like a credit card or auto loan, until your home loan closes.

6. Compare mortgage rates.

The benefit of doing a loan with a mortgage broker, is that we are signed up with many different lenders meaning we shop your rate. The Bally Team makes sure you get the best rate, with the lowest payment, for the best service. Because, as we mentioned, we work for our clients.

7. Get a Pre-approval Letter

You can get pre-qualified for a mortgage, which simply gives you an estimate on how much a lender may be willing to lend based on your income and debts. But as you get closer to buying a home, it’s smart to get a preapproval, where the lender thoroughly examines your finances and confirms in writing how much it’s willing to lend you, and under what terms. Having a preapproval letter in hand makes you look much more serious to a seller and can give you an upper hand over buyers who haven’t taken this step.

House Shopping Tips

8. Hire the right buyers agent

You’ll be working closely with your real estate agent, so it’s essential that you find someone you get along with well. The right buyer’s agent should be highly skilled, motivated, and knowledgeable in the area.

9. Pick the right type of house and neighborhood. 

You may assume you’ll buy a single-family home, and that could be ideal if you want a big yard or a lot of room. But if you’re willing to sacrifice space for less maintenance and extra amenities, and you don’t mind paying a homeowners association fee, a condo or townhouse could be a better fit.

But even if the home is right, the neighborhood could be all wrong. So be sure to:

Research nearby schools, even if you don’t have kids, since they affect home value.

Look at local safety and crime statistics.

Map the nearest hospital, pharmacy, grocery store and other amenities you’ll use.

Drive through the neighborhood on various days and at different times to check out traffic, noise and activity levels.

10. Stick to your budget. 

Look at properties that cost less than the amount you were approved for. Although you can technically afford your preapproval amount, it’s the ceiling, and it doesn’t account for other monthly expenses or problems like a broken dishwasher that arise during homeownership, especially right after you buy. Shopping with a firm budget in mind will also help when it comes time to make an offer.

In a competitive real estate market with limited inventory, it’s likely you’ll bid on houses that receive multiple offers. When you find a home you love, it’s tempting to make a high-priced offer that’s sure to win, but don’t let your emotions take over. Shopping below your preapproval amount creates some wiggle room for bidding. Stick to your budget to avoid a mortgage payment you can’t afford.

11. Make the most of open houses

When you’re touring homes during open houses, pay close attention to the home’s overall condition, and be aware of any smells, stains or items in disrepair. Ask a lot of questions about the home, such as when it was built, when items were last replaced and how old key systems like the air conditioning and the heating are. If other potential buyers are viewing the home at the same time as you, don’t hesitate to schedule a second or third visit to get a closer look and ask questions privately.

First-Time Home Buyer Mistakes To Avoid

With so much to think about, it isn't surprising that some first-time home buyers make mistakes that they later regret. Here are a few of the most common pitfalls, along with tips to help you avoid a similar fate.

12. Not budgeting for closing costs

In addition to saving for a down payment, you’ll need to budget for the money required to close your mortgage, which can be significant. Closing costs generally run between 2% and 5% of your loan amount. You can shop around and compare prices for certain closing expenses, such as homeowners insurance, home inspections, and title searches. You can also defray costs by asking the seller to pay for a portion of your closing costs.

13. Not saving enough for after move-in expenses.

Once you’ve saved for your down payment and budgeted for closing costs, you should also set aside a buffer to pay for what will go inside the house. This includes furnishings, appliances, rugs, updated fixtures, new paint and any improvements you may want to make after moving in.

14. Buying a home for today instead of tomorrow

It’s easy to look at properties that meet your current needs. But if you plan to start or expand your family, it may be preferable to buy a larger home now that you can grow into. Consider your future needs and wants and whether or not the home you’re considering will suit them.

15. Passing up the chance to negotiate

A lot can be up for negotiation in the home buying process, which can result in major savings. Are there any major repairs you can get the seller to cover, either by fully handling them or by giving you a credit adjustment at closing? Is the seller willing to pay for any of the closing costs? If you’re in a buyer’s market, you may find the seller will bargain with you to get the house off the market.

16. Not knowing the limits of a home inspection

After your offer is accepted, you’ll pay for a home inspection to examine the property’s condition inside and out, but the results will only tell you so much.

Not all inspections test for things like radon, mold or pests, so be sure you know what’s included.

Make sure the inspector can access every part of the home, such as the roof and any crawl spaces.

Attend the inspection and pay close attention.

Don’t be afraid to ask your inspector to take a look — or a closer look — at something. And ask questions. No inspector will answer the question, “Should I buy this house?” so you’ll have to make this decision after reviewing the reports and seeing what the seller is willing to fix.

First Time Homebuyer

CroneEmily, Emily Starbuck, et al. “Tips for First-Time Home Buyers.” NerdWallet, NerdWallet, www.nerdwallet.com/article/tips-for-first-time-home-buyers.