We are Home Owners!
On May 18th, my significant other and I bought our first home. We have been working on this goal slowly since we moved back to NEPA in June 2019. Job changes, lots of saving, and the pandemic later, here we are with a home.
As I am sure you know, the housing market is on fire right now. It honestly feels like a miracle that we not only bought a house, but we found one we LOVE! Everything about this home is what we wanted. It’s a pre World War 2 built home in Scranton, PA. It’s everything we could have dreamed of getting! It took a lot of effort emotionally, mentally, and physically to get here, though. I have a ton of advice for anyone looking to buy a home. We were blessed to have family that knew the home buying process well and a stellar realtor.
Here are 10 Tips for buying a home!
Find an area you want to live in. Make sure you want to live here. I have heard to make sure you want to own a home in that location for at least seven years. There are penalties if you sell your home too quickly after buying it. I like to think of a home as a longer-term investment. Whether I plan on living in it forever or I plan to rent it out when it’s time to move on, I don’t recommend buying a home if you only plan to live there for a few years.
Prepare yourself financially. There are a ton of costs to factor in when purchasing a home. There is also a ton of conflicting advice on the right amount to save, etc.
With conventional mortgages, you only need 5% right now. If you do put less than 20% down, though, you will be paying private mortgage insurance. You have to weigh the pros and cons and figure out what works for you!
Work on your credit scores and increase them as much as you can! The better your credit scores, the better your mortgage interest rates are going to be. You by no means need a perfect credit score, just a good, healthy one.
It can be hard to find advice on what your credit score should be and how much you should have saved. I did some self-education through the podcast How To Money. I learned a lot about mortgages and credit scores. I recommend talking, reading, or listening to reputable resources to create your financial plan. Don’t just listen to your friend or family member who may have never bought a house ever or it’s been many, many years. Their advice is helpful but having current and relevant information is crucial.
Set your plan and your budget, and stick to it!
Also, on the topic of mortgages, make sure you are working with a good company. Many good Realtors have connections to lenders that, because of that connection, things move smoothly throughout the buying process. If you do go with a lender outside of the realtor’s recommendation, which might also be a good move based on your rates, make sure they are accessible. Being able to call or email them with any questions you have and get a quick response is crucial.
Find a great realtor in your area. This was key for us finding out home and having our offer accepted. Our realtor was phenomenal. She knew her stuff and was a wealth of knowledge through the process. I feel a good realtor is not only someone who is a great resource and good at making deals but also someone who knows the specific area you are looking in. If they know your area, they will know common issues and perks of the area and help you navigate all of that.
Just because I love our realtor so much, if you are looking for a home in the Scranton Area, please reach out to me, and I will connect you with the one I used!
Learn what you want and don’t want. Spend time paroozing listings and seeing a variety of different houses. See houses below, at, and slightly above the price range you have in your head. CAUTION: don’t look at a house over the amount you are preapproved for; you don’t want to fall in love with something you are not qualified to buy. It’s crucial to see a variety of houses on various streets/ areas within the area you are looking at. You may find you have deal breakers you never thought you would, or you may fall in love with a particular style of house once you see it in person.
Find someone you are close to who knows the process. This is crucial to have an outside perspective on the process you are going through. We were lucky enough that my significant other was very familiar with the house buying process and my parents, who are familiar with the house buying process. This allowed us to educate ourselves and get those insider tips that first-time homebuyers where someone who bought a house years ago might not know. I think having someone outside of your realtor to talk about offers and house issues is helpful. They can serve as a voice of reason if you are feeling unsure or overwhelmed.
Ask all the questions! Don’t be afraid to ask your realtor and your trusted outsider all the questions! If your realtor cant answer your questions or can’t figure them out, maybe it’s time to find someone else. Your realtor should work to help get your questions answered. You should not feel pressured to commit to anything without your questions and concerns being answered. Also, as someone who hasn’t recently gone through the process, I love sharing my knowledge with others. Most people who know the process want to help you!
Don’t get caught up in the hype/ market. Especially right now, it can be easy to get caught up in this hot market. Don’t. Please do not spend money you do not have. Figure out your budget at the beginning of your process and stick it no matter what. Do not compromise your financial health for a home out of your means. Your house is out there, and it will work out within your budget. Trust that.
You’ll learn what reasonable prices are for what you are looking for in which you can adjust your price point based on calculations. You might also need to make a competitive offer, but there are ways to do that without going beyond your means. A good realtor will help you through this.
Take a break when you need it. It can be discouraging to put in offer after offer and not have a house. The house that is meant for you will come to you. It can be easy to just put in an offer on just about anything that seems nice. If you need a break, take one. Houses will still be coming on the market when you’re ready to start looking again.
Put in an offer you are comfortable with. Nothing more. I mentioned this in the don’t get caught up in the hot market. I think this point is crucial, though. In a hot market, you will be very tempted to overpay and outbid anyone for a house. Do not let the hot market or your realtor tell you that you absolutely need to put in a particular offer. You are in the driver’s seat, and you make the decisions. Good realtors know strategic ways to make offers more appealing.
A good example would be writing a letter to the current owner, talking about how much you love their house and your hopes for the home. If your offer is similar to other offers, you might grab their attention a bit more with a letter.
There are so many ways to put in strong offers on a house without going beyond your means and drastically overpaying.
Be prepared for after the offer is accepted. Things right now are moving quickly. Our original closing date was 45 days after our offer was accepted. It moved to 30 days because things moved smoothly.
Understand and ask questions about closing costs. When you buy a house, you don’t just need your down payment; you also need closing costs. You can get sellers assist in helping with closing costs, but it’s better to be prepared to pay them. In a hot market like this, sellers like when you cover your closing costs. I recommend financially preparing a bit beyond your down payment and closing costs too. When the inspection report comes back, and I highly recommend getting an inspection, you want to feel comfortable that you financially can handle any issues the house may have. No house is perfect, and all houses will need some money put into them, even if it’s just painting, getting your furnace services, etc.
Hopefully, this advice helps any potential home buyers out there! Buying a home is a stressful yet very exciting process. I have complete confidence you will find a home that you love!
TL;DR When looking to buy a house, don’t get caught up in the hot market. Make sure to financially prepare for a down payment, closing costs, and other home costs post-closing. Find a knowledgeable realtor in your area; it is crucial to finding a great, sturdy home and getting a good deal, even in a hot market.