Buying My First Home
Buying a home for the first time is scary. Adulting is scary. I had been looking for the perfect home for over 2 years that I loved, but was also in my budget. I live in a private college town so the prices of homes are much higher than surrounding towns, but I did not want to live in surrounding towns. Life likes to throw curveballs so when I first started looking I had one budget, and certain preferences, and by the time I had bought my home I had a different budget, with different preferences.
I always thought I would be on a farm, or somewhere in the country, in a two story farm house, with horses and cows and dogs. But that all costs money, and in a town with inflated costs it was impossible to reach. In the end the house I bought was a ranch style home with a full basement, and a decent sized backyard.
When looking for a home I had to be smart. Not only did I need to look at what the home would cost each month, but also closing costs, the inspections, home insurance. I had to factor that in each month with my income to make sure I wasn't going to dig myself a hole I couldn't get out of. I put together a list of things to think about when buying your first home, in hopes it will make it a little less stressful.
Affordability. Monthly payments are not just principle, but interest, mortgage insurance, and in some cases, escrow, is built into the monthly payment. Realtor.com does typically offer a payment calculator showing what each will cost and the total monthly payment. Do keep in mind that your credit, the area of town, and insurance can change the prices of these, so the calculator is not 100% accurate.
Loans. There are so many mortgage loans out there; USDA, FHA, loans for Veterans. For first time home buyers, if your credit is untouched, (you must be lucky) you may be able to get a 0% down loan. Each loan has different qualifications, and during the process, may have stipulations on the home. Fixer Uppers are not a first time buyer type of home. Some mortgage bankers will send inspectors to look at the home for any scraped paint, cracked windows, missing pieces of the roof, if the soil next to the foundation slopes down(potential flooding hazard) and can deny the loan or require that the issues be fixed before closing. Those repairs are typically negotiated by the buyer and seller, and the seller can decide to take another offer from someone with a different loan type that will not require changes to be made. Also be aware that closing is not always 30 days, and to keep in touch with the loan officer. It took 55 days for my home to close for a number of reasons, and my realtor let me know my company was a little slow
Long Term. Is this a home that you plan to live in for a few years then rent out? A home you want to grow a family in? A home to live in and upgrade to sell to find a better suited home down the road? All these are things to think about. Loan life can come in 15-30 years, and even though you may not have the home for that long, it's still something to consider. For example, I wanted a home that had enough room for me and all my stuff, but also had enough room for my boyfriend and his girls, if the time came. Had a basement that could be remodeled to add even more room if I desired to do so. By all means, do not stretch your budget trying to buy a 5 bedroom home just in case your partner of 3 months wants to move in and have a family in a few years. Start with 2-3 bedrooms, and later down the road if your family grows you can move or add on.
Yard and Neighbors. Are you friendly, or like your privacy? Do you like to mow, and would you need a push mower or ride mower, and which would you prefer not to have to use? Do you have dogs or kids, and is the yard fenced in? If not, that's an additional expense to add in, and not a cheap one. Do you want a garden, or pool, or fire pit?
Kitchen/Dining. Are you a big baker? Do you like to entertain? Open concept or individual rooms? Kitchen size is important. I have a kitchen open to the dining. It is small, and I love cooking so that is a small issue for me, but I also have room to add on down the road, or knock out a wall to open everything up. So right now it is something I can live with, but I have options. Some older homes have supporting walls next to stairs and an extra room in between that just would not allow for many changes without money and harder labor.
Foundation. A poured foundation to me always is the better choice versus a block foundation, or old brick. Everyone's preference may be different, but knowing the flood zone and history of a house will help your peace of mind when choosing a home. Without a doubt some of the homes I loved had a block foundation, and had had water in the basement. Issues like that can be fixed, but that's also a matter of the budget. That was not in the cards for me, so I kept looking.
These are just a few things to start with, and I am always willing to answer any questions if there's something I did not list. Do not let this scare you either! I do not regret buying my home one bit and finally have something I can put equity in, as opposed to paying rent. Hopefully this was helpful and happy house hunting!
Photo by Andy Dean Photography