Rising rent prices and low interest rates make purchasing your first home sound like a great boost to your monthly budget!  There is much to consider: from down payments to paint, many factors of homeownership are different than when you are a tenant in someone else’s home, so you need to prepare now for a new home later.   

 

  • Begin practicing a budget now if you do not already.  There are more expenses involved with homeownership than there are as a tenant and you need to be able to manage your money properly. 
     

  • Check your credit score and correct any mistakes, if any, and do what is necessary to improve the numbers if your score is not going to be attractive to lenders. 
     

  • Learn about the different types of loans available to first-time home buyers. This will help you figure out how you will finance your mortgage as well as how much you need to save for a down payment. 
     

  • Once you go through the pre-approval process, you will know how much house you can afford, making house-hunting easier.  
     

  • Do you love your rental? If so, let your landlord know that you are interested in purchasing the property! They may not be interested, but once they become aware that you will be moving, the thought of preparing and looking for a new renter may encourage them to agree to a sale. All you can do is ask!  
     

  • Browse properties besides houses--many townhomes and condominiums are affordable and convenient and would make the perfect first home! 
     

  • Purchasing a newer house can save money in the long run, because of less up-front maintenance costs and newer houses are more energy efficient. 
     

  • Think about your community options--do you want to live in a managed community (HOA), a rural area, new construction in a planned community, or an older suburban neighborhood?  Each can affect how much you pay in fees, taxes, or maintenance costs. 
     

  • If you have renter’s insurance, and you should, you will note that a homeowner’s policy costs more, because it covers much more than just your belongings.  Most mortgages will include homeowner’s insurance in the monthly payment. If your current agent can find a cheaper rate, go for it! 

 

Think about the freedom to paint your living room firehouse red if you like or being able to have a noisy family dance party because there are no neighbor’s downstairs to disturb!  As soon as you are ready, your next step is contacting a Realtor® to be your guide during the whole home-buying process.   

 

Courtesy of Chester County PA Realtor Scott Darling.

 

Photo credit: ilookhome.com