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Posted on November 3, 2017 - 10:48 AM
by The Nelson Realty Group
Buying your first home can be one of the most exciting experiences of your life. But it can also be one of the scariest.
Buying real estate is a complicated process. And if you've never purchased a home before, the fear of all those unknown variables can make the experience stressful, frustrating, and downright terrifying.
If you're thinking about purchasing a home but are dealing with the fear that comes along with it, don't worry! You're not alone. Most first time home-buyers deal with a certain level of fear as they get ready to buy their first home.
But that fear doesn't have to hold you back. Here are three of the most common fears of first time home-buyers (and how you can overcome them).
The number one fear most first time home-buyers struggle with is the fear they can't afford to buy a home.
But while there are certainly people who aren't in the financial position to purchase a home, becoming a homeowner isn't as expensive as you might think — and sometimes all it takes to be able to buy a home is a little budgeting.
If you're worried about being able to afford a home, it's time to take a good, hard look at your finances. Make a list of all of your monthly expenses and all of your debt. How much are you spending per month on living expenses? How does that compare to how much you'd be spending per month on living expenses if you were to purchase a home? How much are you saving each month? Are there any opportunities to cut back on spending and pad your savings a little more each month? How much debt do you carry and what's your plan to pay it down?
Getting a firm understanding of your financial situation will a) give you a better idea of how much you can afford to comfortably spend on a house, and b) help you come up with a plan to get there.
"My credit isn't perfect. How am I ever going to get a loan?"
If you have less-than-perfect credit, a major fear you might be dealing with is how you're going to get a mortgage.
Many first time home-buyers fear that their credit report might hold them back from securing a loan. But while getting a mortgage with not-so-hot credit can be a challenge, it's certainly not impossible.
First things first: if you're thinking about purchasing a home, you need to get a copy of your credit report. According to an FTC report, 1 in 5 Americans have a mistake on their credit report — and those mistakes can end up costing you in the long run. The lower your credit score, the higher your interest rates will be, so it's important to make sure there's nothing inaccurate on your report that's dragging down your score.
Once you've reviewed your credit report, you'll want to do everything you can to bring up your score before you apply for a loan, like pay down any high credit card balances, which will bring down your credit utilization and bump your score. You'll also want to make sure to pay all of your bills (including your rent and utility bills) on time, which will help show lenders that you're responsible with your debts.
If you do all of these things and still get stuck with a high-interest mortgage, it's not the end of the world! You can always continue to work on increasing your credit score and refinance in the future.
"I have no idea what I'm doing. How am I supposed to successfully buy a home?"
As mentioned, buying a home is a complicated process. From getting to know the market to finding the right kinds of properties to negotiating with sellers, there's a lot to handle. And if you've never purchased a home, it can feel overwhelming. The sense of "I have no idea what I'm doing!" can be pretty terrifying.
But luckily, you don't have to know what you're doing when it comes to buying a home… as long as you work with someone who does. Working with a real estate agent who understands your market is an invaluable resource, especially to first time home-buyers. Your real estate agent can not only walk you through the entire process, but they also handle the hard stuff — like finding that perfect property and negotiating with tough sellers — so you don't have to.
You might be afraid that the fact you've never purchased a house before will hinder the process, but when you work with the right real estate agent, there's nothing to be afraid of.
Purchasing your first home can be a scary process. But now that you know the most common fears — and how to overcome them — it's time to transform that fear into excitement, get out there, and find the home of your dreams!
Based on information from California Regional Multiple Listing Service, Inc. as of 2018-08-16. This information is for your personal, non-commercial use and may not be used for any purpose other than to identify prospective properties you may be interested in purchasing. Display of MLS data is usually deemed reliable but is NOT guaranteed accurate by the MLS. Buyers are responsible for verifying the accuracy of all information and should investigate the data themselves or retain appropriate professionals. Information from sources other than the Listing Agent may have been included in the MLS data. Unless otherwise specified in writing, Broker/Agent has not and will not verify any information obtained from other sources. The Broker/Agent providing the information contained herein may or may not have been the Listing and/or Selling Agent.