7 Simple Tips for First-Time Homebuyers
There’s a lot to think about when buying your first home. That’s why it’s important to know about the process before you get started. (Hopefully we caught you early enough!) Here are seven simple tips to help you when buying your first home.
1. Start saving early.
Saving enough to purchase a home may seem like an unattainable goal. When you first think about saving for a down payment and start doing the math, you may not know how you’ll ever save up enough to make it work. That’s why it’s important to start saving as soon as you can. You don’t have to save the entire amount at once. Just putting a little away each month can help make a big dent in a down payment later down the line. Plus, there are tons of mortgage programs available that may not require large down payments.
2. Compare rates.
Right now mortgage rates are very low. You’ll want to shop around to not only compare rates, but compare features of loans, like origination fees, closing costs, and down payment requirements. Security Service provides two ways to save on fixed-rate mortgage loans: Power Mortgage1 and Power Rate. The Power Rate is the lowest rate we offer, which means lower monthly payments and more interest savings. Power Mortgage, on the other hand, helps you with upfront costs and fees with no closing costs up to $5,0001 and no origination fee (typically a fee of 1% of your loan).
3. Act fast.
The market is hot. That house you just looked at? Even hotter. In the last few years, the demand for housing has grown exponentially, while supply has remained relatively static. That means the home of your dreams is probably someone else’s, too. When you find what you’re looking for, you’ve got to act fast. That’s why it’s so important to do the next step…
Getting a letter of pre-approval from a financial institution is an important part of the home buying process. Once you find the type of home loan you’re looking for, submit an application and get pre-approved before you go any further. Make sure you have all your paperwork in order so your financial institution can get you on the right path. Also let your agent know that you’re already pre-approved. This will help the process go much more smoothly.
5. Shop around for insurance.
Unless you’re paying for your house in full, lenders require you to get homeowners insurance before the purchase goes through. But there are thousands of providers out there. How do you know you’re getting the right coverage? Security Service Insurance* will compare policies for you and find the right coverage at the lowest price.
6. Hire a real estate agent.
Sure you could go it alone, but real estate agents have been around the block (literally) and they know how to help you find a home that meets your needs. Agents know neighborhoods and home types, what to look out for, how to negotiate, and all the other intricacies of buying a home. They can also be excellent resources when you have questions and will handle the large amount of paperwork that comes with buying a home, which is a huge benefit.
7. Don’t spend it all in one place.
One of the biggest mistakes first-time homebuyers make is spending all their savings on a down payment. That can be problematic, especially if you’re buying an older home. Things break and need to be repaired. Unexpected personal expenses happen, too. Choosing to make a lower down payment could be a better option than having a $0 balance in your savings account.
Bonus Tip: Purchasing your first home is a big deal, so keep a level head.
Make sure you go into the process prepared. One of the best ways to prepare yourself is by having a partner to help you every step of the way. Security Service that has the knowledge, experience, and products to help you get through the process easily and into your new home.
Have more questions about the home buying process?
Security Service Federal Credit Union is an Equal Housing Lender. Membership eligibility required. Loan subject to credit approval. Financing available for properties in Texas, Colorado, or Utah. The information contained in this site is provided for informational purposes only, and should not be construed as home buying advice on any subject matter. You should not act or refrain from acting on the basis of any content included in this site without seeking professional advice from a loan officer or other home loan expert. 1) Power Mortgage offer to save up to $5,000 on select closing costs does not cover private mortgage insurance, seller paid closing costs, discount points, pre-paids or reserves. The program is not valid for FHA or VA loans. Closing costs may vary based on transaction. If loan is closed or paid off within first 36 months of the term, member may be required to reimburse all or some of the closing costs incurred. This offer is subject to change without notice.
*Security Service Insurance (SSI) is a subsidiary of Security Service Federal Credit Union. Products offered by SSI are not insured by the National Credit Union Administration (NCUA) and are not issued, guaranteed, or underwritten by Security Service or the NCUA.
◊ Image is for illustrative purposes only. Not an actual member.