First Home Buyer Tips - Welcome to Wealth & Wardrobe (2024)

FAQs

What not to do when you first buy a home? ›

1. The Location. They say the three most important things to think about when buying a home are location, location, location. You can change almost everything else, but you can't change your home's location.

But is there a right age when these factors should be in place? And are these the factors Americans should consider when deciding to become a homeowner for the first time? In 2022, the average age of first-time homebuyers was 36, according to the National Association of Realtors (NAR). This is up from 33 in 2021.

Ignoring Their Budget

One of the most common mistakes first-time home buyers make is underestimating the costs involved. It's crucial to establish a budget and stick to it. Include not just the mortgage, but also property taxes, insurance, maintenance, and unexpected expenses.

Here are some qualities to keep an eye out for: misaligned doors, cracks in the walls, sloping in the floor, and the windows are hard to open or has cracked glass. If you notice a lot of these qualities during a house tour, have an inspector take a look at the foundation before committing to the home.

You should aim to keep housing expenses below 28% of your monthly gross income. If you have additional debts, your housing expenses and those debts should not exceed 36% of your monthly gross income. Your max purchase budget is the loan amount that lenders could probably give you based on what you've told us.

Home Buying and Real Estate Professionals

71% of buyers interviewed only one real estate agent during their home search.

How old is the youngest homeowner? ›

An Australian eight-year-old girl has become one of the world's youngest homeowners after buying her first place. Ruby McLellan bought the house back in December 2021 for $671,000 (£345,420), and has already made a hefty profit on her investment.

The median age at the time of moving out was about 19 years. (See figure 1.) Table 1 shows that the likelihood of moving out before age 27 was correlated with several individual characteristics. Women were more likely to move out than men were, and Whites were more likely to move out than Blacks or Latinos.

It costs a LOT more than they say it will.

Of COURSE they're going to want you to think you can afford that bigger loan! Don't believe them. Figure out your monthly budget and go by that. In the same vein, you're going to have to pay for so much more than just the down payment.

Collections show on your credit report, and outstanding collections will raise concerns for lenders. Charge-offs are debts that cannot be collected and are written off by the lender. Any debt overdue (120 days for loans, 180 days for credit card debt) must be written off. Bankruptcy debt is also written off.

Conforming Loan Down Payment – $500k House

Conforming loan down payments can vary from 3% to 20% or more, so for a $500,000 home, you'd need between $15,000 and $100,000. Conforming loans, once again, follow Fannie Mae and Freddie Mac guidelines and usually offer competitive terms.