I'm Ready to Roll For The First-Time! How do we do this?
Owning a home may be your dream, but in order for the purchase to be the happy and satisfying experience it was meant to be, you need to ensure that you are financially and mentally prepared for the responsibilities that come with it.
Many people have a notion that home ownership is like renting, but with the power to have pets with no restrictions, obtain yard space, and paint the walls whatever color you like. However, while these privileges can be perks of homeownership, they come with the responsibilities of a mortgage, taxes and home maintenance. Preparing for home ownership requires you to take critical stock of your finances and your expectations.
Questions for Prospective Homeowners
Q1. Am I ready to buy?
Answer: Owning your own home is about more than just being able to decorate any way you like; it's about being prepared to maintain your home over the years, realizing that part of your income and time will go towards repairs and maintenance. It's about being willing to take the risks of home ownership with a realistic expectation of the rewards. Determining whether you're ready to buy also entails preparing yourself for qualifying for a loan. This may mean eliminating debts, working on your credit, or just saving up for a down payment. You may also have questions about what certain words in the industry mean. For instance, what's equity? What is a homestead exemption? What is an option period? Feel free to consult our Real Estate Glossary for common terms, but don't be afraid to ask your hired Real Estate Professional. That's why we're here!
Q2. Where do I start?
Answer: The first step you make is contacting a couple licensed Realtors. This is one of the most expensive purchases you will ever make and you want to make sure it's handled by someone who knows the process and is equipped to handle it. Interview Realtor's and look for experience, market efficacy, and knowledge. That they understand what to look for in inspections and how to negotiate effectively. Also, consider the personality of the Realtor. You will want someone who makes the process enjoyable and that you feel understands your wants, needs, and expectations for who you hire. They should make the process engaging and relaxed, but never unprofessional. At the end of the day, this is hundreds of thousands of dollars exchanging hands and you want someone who takes that seriously. Ensure they are easy to reach and emphasize a priority on active, open communication. Make sure your Realtor is full-time, committed, and can supply references. ....And yes, we're all of the above and have an extensive 100+ client referral list. Just ask!
Q3. Ok, I have my Realtor. How do I begin?
Answer: Before you just jump in to looking at properties, you will need to get pre-approved or pre-qualified for a loan. This will help determine your "purchasing power" in how much you are qualified to spend. Shop lenders and find one who can not only offer a good interest rate and low closing costs, but also has a record in closing loans on time. You can also easily get in touch with a lender HERE. The last thing you want destroying your transaction and potentially risking your earnest money deposit is a lender's inability to meet a deadline. Great lenders in town can be found on our Client Concierge.
Q4. How much can I afford?
Answer: It can be discouraging to find that your salary won't stretch as far as the home you want to own. However, sacrificing a huge part of your income just to pay the mortgage can very quickly make home ownership a burden rather than a point of pride. It's better to buy a modest home now and look at purchasing your "dream home" in a few years. There will also be costs associated with getting a loan. These costs are called "closing costs" and "prepaids." Closing costs are charged by the lender and title company for providing the loan and title work. Prepaids are payments made into your escrow account at closing to create a buffer for insurance and property taxes. Make sure to save up for these extra costs and perhaps, an emergency fund. Contact us to find out how we can help save you on your closing costs and prepaids!
Q5. What is my debt-to-income ratio?
Answer: This is something that lenders take very seriously. Your overall debt should not be more than 40% of your income, and your housing debt should not be more than 32%. What 32% of your income will buy depends on where you want to live. In rural areas for example, it can buy a very comfortable residence and ample acreage. In suburban areas, a more recently-built home with more size and an adequate yard space. In highly sought-after urban areas however, it may be a 400 square foot efficiency condominium. Different neighborhoods and locations can determine how far your money will get you. As the adage goes: location, location, location.
Q6. What do I want?
Answer: Do you like the idea of cleaning your own gutters? Do you shudder at the thought of lawn care? Would you rather just pay a fee every month and have everything done for you? Would obeying rules about when you can have your garbage cans out bother you, or do you want to live in a neighborhood where everything is 'just so'? The answers to these questions can help you narrow down the search for the right type of property for you. Hiring an experienced Realtor can help you figure out and prioritize your wants versus needs and help you locate the exact type of property that fits your requirements, no matter what side of town you need to live.
What are the priorities? Want great schools for your kids? Short commute to work? In-Neighborhood amenities? Close to something specific like Starbucks, downtown bars, a gym, or major shopping hubs? We got it covered! Austin is an amazingly unique city in the variety of types of properties buyer's have as options. You can live in the suburbs with neighborhood amenities or a downtown hi-rise condo in the middle of the action. You can live on Lake Travis or Lake Austin or you can live in the mountains. Live on a farm with acreage and horses or in a quaint east Austin bungalow. There are so many options for housing in Austin that there truly is something for every person and personality. We work with it all and can help narrow down and locate whatever type of property you seek.
Join Us and Become a Home Seeker! Contact for more information about first-time home purchasing and how easy we make the process for all our buyers.
We Can Help
You need a good agent who will work hard for you. Our real estate team is dedicated to helping you find the right home, at the best price. We want you to find the home that will make you happy and successful in real estate ownership.
When you hire us to help you buy your first home, we want to know what you want and how much you can afford. Then we'll find a way to merge these two priorities and find a residence that you'll enjoy owning.
Keep your objectives in mind when visiting a home. Sometimes the idea of owning a home can overwhelm your practical sense, so keep your feelings in check. Keep a list handy of the features that you need and want in a home, and judge each home by the list instead of by details that could distract you from your goal. When you're alone with your agent, you can go over the pros and cons of each home. We can help you stay on track while still keeping our eyes out for a great property.
Make the offer. This can be a maze of "buyer", "seller", "chattels", "deposit", and "completion". We'll be happy to prepare the paperwork and go through it with you before submitting it. Remember, the seller may reject or counter your offer, so even at this late date, avoid setting your heart on the home you hope to own. You'll probably have to write a deposit check to the seller's broker that proves the seriousness of your offer.
Get all necessary inspections done. A home inspector will check for signs of harmful materials like asbestos, lead paint and mold. They'll also check for evidence of pests, faulty wiring and leaks. This is a crucial part of the home purchase. Not getting an inspection done means that you could be stuck in a home with a bad case of black mold and no recourse other than to pay for its removal. Inspections will cost a few hundred dollars, but again, this is more than worth it in the end. There are several inspectors in the area that we'd be happy to recommend.
Do a final walkthrough before closing the deal. We're right there to do this with you to make sure that everything agreed upon by way of repairs is completed prior to the final signing. The last thing you want is to close on the home and go to move in and see an enormous hole in the wall that was hidden behind a painting. Make sure to have someone in your corner to defend you against situations like these!
From the first interview that determines your requirements, to the moment that you receive the keys, we can help with the complicated process of buying a home. Don't hesitate to contact us to find out more about how we can make the home buying process easier!