7 Steps for First Time Home Buyers

Congratulations. If you’ve gotten this far you that means you are seriously considering purchasing a home for the first time. Silva Lending understands that buying a home is an incredible responsibility, but it is also an incredible opportunity. Owning your own home provides you with a blank canvas to paint every detail of you and your family’s future. From the grass you plant to the colors of the walls, it’s all your choice. A choice and equally as important, an investment you’ll need to prepare for. Silva Lending would love to be your trusted partner throughout the entire process, and in that spirit, we have highlighted six steps for First Time Home Buyers like you.


Step 1: Plan Ahead!

If you wanted, you could go to a Car Dealership today, peruse the lot, pick the car of your dreams and in most instances drive off in your new vehicle that same day. Unfortunately, home ownership is not so transactional. To buy a home you’ll need to do two vitally important things, Pay off your existing debt and Start saving for the down payment. These two elements are usually the two things that make most potential homeowners throw up their hands in defeat. Depending on your financial situation this process may take some time, but once accomplished, you will have conquered arguably the most important obstacle to home ownership.


Step 2: Improve your FICO

This step goes hand in hand with Step 1 above. As you pay down your debt, your FICO scores will steadily rise. Remember to do everything in your power to continue that upward ascent. In short, that means not doing anything than can potentially hurt your credit score. Things like having too many inquires can damage your score over time. Paying off any negative elements on your credit report and disputing any incorrect information are also vital steps to take. Your FICO score is key to getting you the optimal rate for your home, the better the FICO, the more affordable your new dream home will be.


Step 3: Get Pre-Qualified by a Reputable Lender

Knowing how much you are qualified for will put the entire home buying process into greater perspective. The home price, number of rooms, location and needed down payment are all connected to your pre-qualification amount. Have you ever gone to the grocery store with a fixed amount of cash? You’ve loaded up your cart with things like eggs, carrots, cheese and milk. You’ve waited in the line, the cashier has rung up your groceries, and suddenly you realize, ‘I don’t have enough money.’ This realization hits a lot of first time buyers who neglected to get pre-qualified. It also impacts the way Realtors view your offer. Potential buyers with a pre-qualification are much more likely to have their offers considered than buyers without one.


Step 4: Choose the right Realtor by asking the right questions.

Are you full time? How long have you been in the business? How many homes have you sold in the last year? What area do you specialize in? These are call great questions to ask your potential Realtor and their answers should guide your decision. Buying a home is an important and personal process, having some one who recognizes that importance and is personally invested in you makes all the difference in the world. Home buying can be a complicated process, you truly need a guide who knows their way in and out of all the details. A guide who knows not only what you need to do, but also what THEY need to do. Many first time home buyers have been let down by realtors who didn’t didn’t work tirelessly for them. This often times means losing out of amazing gems or not even knowing they existed in the first place.


Step 5: After your offer is accepted

Make sure you hire a qualified/recommended home inspector. Once the house is yours, it’s YOURS. That means dripping faucets, damaged floors, weathered carpet and leaking roofs. Your home inspector can help you identify these items and your trusted Realtor can help you factor in these repairs. This can include asking the seller to credit you for these repairs. Without an inspector and dedicated Realtor, you could be left holding the bill.


Step 6: When in Escrow, respond QUICKLY and CORRECTLY.

Once in Escrow, you can expect a ton of paperwork. This includes items like Home Owners insurance, loan conditions, contingencies and a wide array of potential curveballs. Hopping on this paperwork is an essential piece to a smooth transition out of escrow and to your keys. Delays in responding to information requests and submitting paperwork can throw off the cadence of your escrow and cause delays. Delays can cost you money or even worse, your dream house. Ask your Realtor to explain anything you don’t understand and respond quickly to any and everything that may come up.


Step 7: Don’t make any large purchases until after you close Escrow.

As you get closer and closer to getting the keys to your new home, resist the temptation to purchase anything for that new home. Your finances and your credit balances will still be in a delicate balance and your financial stability will still be very much under the microscope. Resist the urge to buy new appliances, furniture or cars. There will be plenty of time to fill your new home with everything it needs, 15-30 years of time to be exact, so always wait until the ink is dry before you purchase that new washer and dryer.