The First Time Homebuyer's Guide

Buying your first home might seem like an overwhelming task, but it's not as scary as it sounds. Follow this easy step-by-step, and you'll have the keys to your dream home in no time!

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1) Find a realtor you trust

It might seem like a waste of money, but you need a realtor and here’s why: A good realtor will save you money in the long run, not just by negotiating but by doing many things along the way. For instance, your realtor can set you up with a good contractor, one who will actually show up. Realtors have knowledge you wouldn’t even consider--they’ve seen it all and can navigate you through every mold inspection, not to mention let you know about important buyers’ programs that would otherwise be hard to find.

So the question is, how do you find a good one? Simple: Ask around. Ask your mom, ask your friends--believe me, there’ll be plenty of opinions to go around. A good realtor is a member of the community, and because of that they’ll be easy enough to find. But if all else fails, just have a meeting with someone and go with your gut. Remember, a realtor can tour you around a house without costing you a thing.

2) Know your expenses

It might sound obvious, but you need to know for sure that you can actually make those mortgage payments. Wishful thinking can lead us to fudging math that really can’t be fudged. To make absolutely sure, set aside what you’re prepared to pay every month for a year in advance. Make sure to accurately gauge those utility payments: In certain places those can range widely from season to season, especially in an old house. You need to know that you can make those payments, even if worse comes to worst.

3) Inspections are everything

Really pay attention during those inspections. Factors like paint color and furniture can be changed easily while a broken plumbing system is less than an easy fix. Again, this might seem obvious, but a lot of the time superficial issues such as decoration affect homeowners’ perception far more than important issues. Water damage, outdated electricity systems and roof issues are all expensive fixes that you shouldn’t underestimate. Once you’ve calculated how much you’re expecting to pay on repairs, double it. Trust me, it’s the easiest way.

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4) If it's an old house, be warned!

Beautiful wood paneling? A breathtaking fireplace? This sounds romantic until you realize the cost of a slate roof. Not that that should stop you, but remember, when buying an old house get prepared for a project. Things will happen that you’re not expecting, and those little surprises might cost big. Add in heating bills, a lack of AC and bad plumbing, which are all structural issues most old houses face.

5) Know your mortgages

If you’re like most people, reading the fine print of a mortgage agreement is a great way to get an early night’s sleep. That being said, the difference between a bad mortgage and a good mortgage is the difference between a fender-bender and a car crash--so do your research. You need to know the difference between a fixed rate and an adjustable rate mortgage, and the difference between an FHA loan and a loan from Fannie Mae. Remember, your realtor can be your biggest ally here, since they probably know state and local assistance programs. If you want to do the legwork yourself, however, check out this helpful guide.

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6) Research your neighborhood

The funny thing is, the most important housing factor may not be the house. The neighborhood determines so many of your possibilities, from school districts to safety. Check out AreaVibes, a free web app that lets you look up the neighborhood and compare its amenities and crime stats to those of other areas. Great Schools, also, can help you get a sense of test scores, and whether the school district is good. The rest you can do by asking around and checking out the neighborhood: Do people hang out outside? Are there lots of community centers? Are the houses maintained? You can always ask neighbors for the skinny: Complaining can give you some valuable intel, and people love to complain.