A home is likely the largest purchase you will ever make in your life. And it truly is a big deal, so if you are a first-time home buyer in Texas, you are probably wondering how to get started on such a massive venture.
The home buying process may seem complex and overwhelming at first, but as you navigate through all the necessary steps and requirements towards purchasing your first home, you will start to understand exactly how to navigate this experience.
Enlisting professional help is always recommended, as a licensed real estate agent can give you insight on available homes in your area, and can represent your best interests along the way. This will drastically simplify the home buying process overall.
We’ve put together a guide to help first-time homebuyers like yourself figure out how the process of buying a home works. Here are some of the things you should know so that when the time comes to purchase your home, you’ll feel like you’ve been doing it your whole life.
Knowing the Advantages of Buying a Home
Before you consider whether you are ready to purchase your first home in Texas, or whether it is even worth it, you should first consider all of the benefits that you’ll have available to you as a homeowner.
Once you have your first home, you’ll be entitled to:
- Tax breaks
- Federal Loan Programs
- State programs for funding and housing help
There are many other benefits to first-time home buyers as well. But, how exactly does the state of Texas define “first time”? This essentially includes anyone who hasn’t owned a home for over three years, or if you or your spouse have never owned a home before.
There are other exceptions that can define a first-time home buyer as well, and you can consult with your real estate agent to find out whether you qualify.
Assessing Your Readiness
The next thing you should do before taking the plunge and making an offer on a new home is to assess your financial readiness. Like we mentioned earlier, a home is a huge purchase, and you need to be sure that you are financially prepared for such a large investment.
You also need to take a good look at your savings account. You should save up at least six months of “emergency” funds in the event of unexpected expenses. It’s also important to be thinking about the upfront costs you’ll have to come up with early on in the home buying process.
For example, once you have purchased your home, you will need to make a large down payment. There will also be sale closing costs that you have to pay for. Your lender will most likely require that you have a certain amount of savings before you even start the process.
You will also have to talk with a lender about what kind of mortgage you qualify for as well. In most states, and with most lenders, it is required that you are pre-approved for a loan as well as pre-qualified to take out a certain amount of money with a discussed payment plan moving forward.
You’ll find different loans and financial aids available through HUD, your state, the IRA, and even through special programs, such as the Section 184 loan for Native Americans.
Finding Your Ideal Home
Starting the search for your new home can be a very exciting time. You will enjoy speaking with your agent about the type of home you are looking for, and what kind of features you want it to have.
This is your time to communicate about the kind of home that would best suit your needs and your lifestyle. Are you looking for a house with enough space for your spouse and children? Or are you alone with your spouse and you want to downsize to a comfortable one-bedroom home? There are also townhouses, condos, and multi-family buildings that you can take a look at as well.
Once you have worked out your financial readiness and found a home you like, you can start making offers.
There may be a lot of back-and-forth during this phase of the process, as the seller can come back with a counteroffer and may initiate negotiations until both parties are satisfied with the deal.
Making an Offer and Closing on Your Home
Once you are ready to make an offer on the home, you will have more financial considerations to discuss with your lender and real estate agent. Closing costs will be calculated anywhere between 2% to 5% of the total purchase price, in addition to repair costs and other upfront needs.
Some of the final costs you will have to pay for include a title search, home appraisal, and mortgage insurance. As long as you stay in communication with your lender and agent, you can easily manage these fees during the closing process.
Congratulations on Owning Your First Home!
After all is said and done, you and your family will officially be first-time homebuyers in Utah and you can enjoy your new life in your new house. Just remember to keep planning for future costs such as monthly utility bills, mortgage fees, and additional loan payments.
The home buying process may seem like a big commitment, especially if this is your first time navigating these tricky waters. But with assistance from your trusted real estate agent and the approval of your chosen financial institution, you will get through it and be on your way to becoming a first-time homeowner