Tag: first-time homebuyers

Real Estate

5 Steps To Prepare For Your First Home

Lupe Ruiz, REALTOR®/Broker

You would like to buy your first home but don’t know where to start? Here are five things you can start working on:

  1. Establish good credit – You can open a credit card and use it for small purchases you can afford to pay off at the end of the cycle. Or, get a secured credit card at your bank. With this type of credit card, you deposit your own money and only charge up to that amount. You can also ask someone with good credit to add you as an authorized user on one of their credit cards— but, most importantly, pay on time and do not max your cards (tip: use no more than 30% of your credit limit).
  2. Prepare to afford a house – As a general rule, your total housing expenses should not be more than 28% of your gross monthly income; and ALL monthly debt (including housing expenses) should not exceed 36% of your gross monthly income. Housing expenses include, the monthly principal and interest, property tax, homeowner’s insurance, and homeowner’s association (if applicable).
  3. Save, save, save – Down payments can be as low as 3%. In addition, you will have closing costs of around 2-3%. For example, if the price is $500,000, your down payment could be as low as $15,000 and your closing costs between $10,000-$15,000. You could potentially need around $30,000. You can also receive gifts to help with these costs and, depending on your credit, you may qualify for other down payment assistance programs. However, keep in mind that the higher your down payment, the lower your monthly mortgage payment will be.
  4. Crate an emergency fund – Have a separate account with funds you will not use unless it’s for unplanned expenses or other major emergencies. Ideally, this would be three to six months your monthly expenses.
  5. Plan a budget – Budget when you are saving to buy your house and when you buy your house. A budget will help you track bills and pay on time. Also, keep in mind that when you own a house you also have additional utility and maintenance expenses.

Buying a home for the first time can be scary. You might not know where to start. This is why it is so important that you work with a real estate professional who will guide you through the process. When you are ready to buy, get in touch with a real estate agent. They will refer you to someone who can pre-approve your loan and will get you started on your home search.

Real Estate

WHAT FIRST-TIME BUYERS SHOULD KNOW

Lupe Ruiz, REALTOR®/Broker

During this video, I give you an overall view of some things you need to know to be ready to purchase your first home. I would also like to add that in addition to the down payment mentioned, I would also like to mention that buyer closing costs could be up to 2-2.5%. This might seem like a lot at a glance but there are options available for you. Ask me what are your options.

Also, there are some banks who will still lend under a 640 FICO score and might still have down payment assistance programs right now, but with changes in the industry due to the current pandemic, most banks got stricter on their requirements. However, don’t get discouraged by this. An experienced Realtor in partnership with a good lender can help you through the process.

Remember you can always contact me with questions on purchasing your first home.

Real Estate

10 Tips for First-Time Homebuyers

Lupe Ruiz, REALTOR®/Broker

Congratulations, you have gone to your local bank and were pre-approved for a $350,000 home loan! You already know the location and the features you want in your new home, but now what? Where do you start? Do you go calling every listing agent in town? Or, do you just go on-line and see what is on the market? Here are some tips that may be able to help you during your home search.

1. Work with an experienced Realtor who can guide and advise you during the process. It is important you have your own Realtor representing you as the buyer in the transaction. A selling agent, will help you search homes, show them to you, and negotiate the deal for you.

2. Trust your Realtor. Your Realtor is the expert in the industry and can tell you whether or not you should offer asking price; or what terms should or should not be included in the Purchase Agreement.

3. When it comes to viewing homes; take all decision-makers with you (including those who are not buying but have influence in your decision-making). Many times, new homebuyers see a home they love, submit and get an offer accepted, but then get cold feet when their relatives or friends “warn” them about everything they should’ve considered before submitting an offer. Hence, causing the buyer to cancel.

4. Have an open mind. You might not be able find the perfect, dream home so you may need to purchase one that needs some tender loving care. Or, if you do find the home of your dreams; keep in mind it is also someone else’s dream home; so take your Realtors’ advise on the best offer you should submit.

5. Purchase a Home Warranty. A home warranty may save you a lot of money if a large item such as a water heater, air conditioning, plumbing, appliances, etc breaks down.

6. Do not purchase any large items on credit. This may interfere with your loan approval and may prevent you from moving forward with the transaction. This is relevant at all stages of the home search and, even more so, during the escrow process.

7. Communicate and cooperate with your Realtor and loan representative. It is imperative that you maintain constant communication with them as they are working hard to get you qualified and into your new home as soon as possible.

8. Don’t view too many properties. More than three trips and viewing too many properties may create the mentality that the more you see, the better deal you will find. However, instead, this will cause confusion and second thoughts; hence, prolonging the home search and possibly walking away from a good opportunity.

9. Obtain a home inspection. Even if the home appears to be in perfect condition, it is always recommended that a trained professional inspect the property. If the inspection reveals serious defects that the seller did not disclose you are generally able to rescind your offer and get your deposit back.

10. Avoid buyer’s remorse. It is not uncommon that somewhere during escrow, homebuyers may question if they made the right decision. You may avoid this by doing your homework beforehand and matching your expectations and price range. If you’ve done this, your stress level may be reduced and buyer’s remorse may have been avoided.