Buying a home can be daunting, but buying your first home can be especially overwhelming because the process is so new and seemingly much more permanent than renting. This article is designed to alleviate some fears and worries for first-time home buyers.

A few things to keep in mind as you begin this journey:

• Real estate never sleeps. If you're trying to buy a hot property, you have to move quickly, or you could possibly lose it.
• Be realistic and prioritize your needs/wants. Make a wish list but understand that the house you will pick will likely not have everything on that list.

Step 1: Find a GREAT Realtor.
Your Realtor is your guide throughout each step of the home buying process. He/she is your go-to source for finding the right neighborhood, lender, home inspector, and much more. It is essential to find a Realtor that is both knowledgeable and reliable.

Here are some important tips:

• In most cases, sellers pay the real estate agent commission. For the home buyer, it typically costs nothing or very little to use a Realtor; so take advantage of their professional services and networks. Choose a representative who is dedicated to meeting your needs as a first-time buyer.
• Find a Realtor who you trust and who knows your area very well. A recommendation from a friend or family member is often a good place to start in your search for the right individual.
• Use a full-time Realtor. Somebody that is working in your market area every day will be more likely to have access to homes that are not yet listed and be up to date on market trends.
• The Realtor with his/her face on every For Sale sign in the neighborhood might not be the best choice. Although they likely know the market well, they may not have time to dedicate to your needs or may pass you off to a less experienced team member.

Step 2: Get Pre-qualified.
Once pre-qualified, you will know exactly how much your bank will lend you for a home purchase; and more importantly, you will know how much you are comfortable spending. More times than not, those two numbers will differ.

Important Tips:

• Get pre-qualified BEFORE you begin looking. If your dream home lists in a fast-paced market, you will likely miss out on the home if you do not have a pre-approval ready to send in with an offer.
• Ask for a few lender recommendations from your Realtor. Your Realtor knows and works with many lending institutions and will be able to point you in the direction of a few qualified professionals. You can then decide who is offering the best product at the best interest rate to meet your specific needs.
• Determine what you are comfortable spending. What you prequalify for SHOULD NOT BE your budget. Spending more on a home than you can afford is a horrible way to build wealth.
• Once you begin looking at homes, ask your lender to prepare cost sheets for the homes you are most interested in. A cost sheet breaks down your mortgage payment into a monthly rate (including taxes and insurance) so that you can easily compare it to your monthly rent.

Step 3: Start the Hunt.
Once you have found your trusted Realtor and are pre-approved, you can begin looking at houses.

Important tips:

• Discuss your needs, wants and wishes with your Realtor. Be as clear as possible.
• Use an automated Multiple Listing Service (MLS) search to begin your property search from the convenience of your home computer. This is a great way to stay on top of a fast-paced market without overlooking any homes that meet your criteria.
• DO NOT rely solely on websites like Zillow and Realtor.com. Trust your Realtor to keep you updated on new houses as they hit the market.
• TOUR! Pictures posted online can be misleading. If a house is listed in your price range and in your neighborhood of choice but you see a flaw in the pictures, be sure to take a house tour! You won’t fully appreciate the property until you enter the home and see it for yourself.
• Avoid the “hot” neighborhoods. Just like with investments, real estate has its trends. So look for the next up and coming area and get more bang for your buck.
• Warren Buffet is famous for saying, “Price is what you pay, value is what you get.” While this relates to investing in stocks, it is also holds true for real estate. Look for value.

Step 4: You’re Ready to Buy!
Once you find the home you want to purchase, your Realtor will guide you through the entire process, keeping track of deadlines and contingencies, as well as ensuring a timely and smooth closing.

Important tips:

• When making an offer, keep in mind current market conditions. Fair market value of a home may be higher or lower than the list price depending on how many buyers and sellers are currently participating in the marketplace.
• Offers must be submitted in writing to the seller. Do not make an offer unless you are prepared for the seller to accept, meaning you agree to purchase the home.
• Send a personalized letter. Introduce yourself and describe what you love about the home. This could be a deciding factor in a multiple offer situation.
• Ask your Realtor to review upfront costs vs. costs paid at closing:
  • Home inspections and appraisals are paid at the time of service.
  • Transfer taxes, insurance, lender fees, etc. are paid at closing.
• Discuss contingencies with your Realtor. For example, you will almost always want a home inspection contingency to protect yourself in case of an unforeseen problem with the home. There are many other contingencies that may be beneficial to you as well.
• Once all contingencies have been cleared, the loan has been prepared, and title work completed, you will schedule your closing. This is where you pay the seller, sign the necessary paperwork, and take possession

We trust this article will serve as a good guide for purchasing your first home. Good Luck!