A Gift Guide for the First Time Home Buyers
Many financial and real estate experts often say that there’s “never a better time than now to buy your first home.” But with house prices through the roof these days, that can feel pretty far-fetched. However, even acknowledging that prices are very high, the idea of a home ownership has some benefits that can be even more important in today’s world.
First of all, you will not have to worry about the rent increasing, for instance, tripping or even your landlord who may decide to sell the property. Also, each time you reduce your mortgage balance, this is an addition towards home that makes you gradually inch closer to mortgage freedom.
So, where do you start? This blog is a gift for those who are willing to start the process of becoming homeowners. In this post, we’ll guide youstep by step through the process of buying your first dream home.
Choose the Right Realtor
The Myths of Hiring a Real Estate Agent
There are a number of myths regarding whether or not it is possible to really benefit from hiring a real estate agent. Many people selling their homes independently think they will save money, but they are oftentimes mistaken. Selling a home can be time-consuming, and sometimes, properties are sold for less than anticipated.
Why It’s Important to Hire an Agent When Buying
This is especially true when buying a home, as it would be unwise to go through the process alone. Sure, you might get help from friends and family, but turning to a professional is a smarter choice. The cool thing? An agent’s commission is already included in the deal. So, when selling a house through an agency, the owner doesn’t pay the agent directly—it’s deducted from the sale amount. You get the benefits of expert guidance without spending extra.
The Support of a Real Estate Agent
Of course, you’re going to have a pile of questions, and sometimes you might wonder if buying a house is the right decision. That’s where a real estate agent really shines. They act as your personal guide, explaining the entire process step-by-step. But if you’re new to picking an agent, where do you even begin?
How to Choose the Right Real Estate Agent
Do Some Online Research
Google real estate teams in your area and read the comments and reviews on their pages.Check Their Experience
Look for agents who have been practicing in your specific area of interest. Ideally, they should be familiar with a market that’s either increasing or decreasing in value.Reach Out to a Few Agents
Make a list of potential agents and send them a few questions by email. How soon and how well they respond should give you a good impression of whether they’ll meet your needs.
The First Steps to Homeownership
After you have settled for a particular agent, it is time to start your journey of owning a home. But what does that mean?What people say about professionalism and providing care and services is confusing when you try to see how it works in real life.
If you are new to the process, you can even begin by getting pre-approved for a loan. What is quite interesting is that it only takes about 5 minutes to do, because you can even do it over the internet and you fill out a number of questions about your revenue, your debts and your income. By the time you are done with just a few minutes, you will be able to arrive at the estimation of how much a lender may be ready to offer you.
Once you are perfectly sure that the time is opportune for you to make a purchase, approach your real estate agent and ask him or her to take you to a mortgage broker. The next step involves going around looking for pre-approval for the mortgage which will help understand the actual amount that one is likely to be approved for. The pre-approval also determines the interest rate for mortgage for a period of 90 to 120 days.
Dreaming About Your New Home:
It can indeed be exciting depending with how one looks at it! You will begin to wonder about how the new home will look like and which kind of area you would prefer to reside in. The list you should make is what you require and what you would like to access in a home in order to help you stay organized. Here’s a basic list to help you start:
- What do you expect from the home? There is nothing like a small landscaped condo or a large house with a small backyard?
- In which type of area do you wish to build your home? Which city and neighborhood?
- Would you like to own a newly developed home or a home that belongs to an older development?
- What specific bedroom and bathroom needs will your family have?
Understanding Down Payments
Because housing prices are so steep, you may well imagine that you have to have a lot of money to put down upfront, but this is not always the case. This is a common cliché that has been circulated over the years to the effect that one has to pay 20% of the price of the home in earnest money. But in reality, there are certain conditions of the organization that stipulates that the down payment cannot be less than a particular amount which varies with the price of the property.
Get the Closing costs
The cost of the property is not the only price that is paid when acquiring a home as there are other expenses to be incurred such as the closing costs. Realtor fees refer to the cost of preparing legal documents and other documentation costs and therefore one should be ready to part with between 3% and 4% of the price of the home. Here are some examples:
- Title search costs in order to avoid controversy and ownership of home.
- Relevant insurance products include title insurance in order to be safeguard against real estate fraud or identity theft.
- Any connection charges with the utilities and any initial cost of upkeep and maintenance.
- A property insurance, home inspection, and appraisal fees.
- There are certain expenses which are incurred by the buyers at the time of purchase for example; Fees for transfer of land.
- Mortgage insurance in case the down payment made is lower than 20% of the price range of a home.
Government Resources for the First Time Buyer
If all these numbers are too much to handle, don’t stress because there are several first time home buyer government programs. Here are some options:
- Home Buyer’s Plan: This means if you borrowed up to $35,000 in your RRSP then you do not owe the federal government taxes for it unless you borrowed was not repaid for 15 years.
- First Home Savings Account (FHSA): This program allows up to $8,000 each year or $40,000 throughout the lifetime of the kid’s saving to be deposited to a tax-free account. The best part? These are grants and as such, you don’t need to refund the grant awarding agency with this money.
- Land Transfer Tax Rebate: First time buyers of a home are allowed to have a refund of up to $4,000 on Land Transaction Tax (LTT).
- First-Time Home Buyer Tax Credit: Some of the other costs that are linked to acquisition of the home you are allowed a tax credit of up to $ 1500.
Ready to Learn More?
Still have some questions regarding to first-time home buying? Don’t hesitate to reach LesleyTucker, the best in this business. We’re here to guide you through every step of the process. Owning your own home might be closer than you think!
