First Time Homebuyers
If you are a first time homebuyer, congratulations!
I look forward to helping you own your first home. The process can also be overwhelming at first, but my goal is to make this exciting time for you fun and memorable! I take the time to educate you on the process, both before and during the home buying process. I am your advocate and will be there for any question you may have no matter how big or how small.
Whether you are just beginning to imagine what you want in your first home, have been searching available homes online, or have even be approved by a lender, let’s talk! It can never be too early to plan. In the meantime, here are some of the things that a first time home buyer should be considering:
Where Do You Want To Live?
What kind of surroundings are you looking for? An urban setting with services within walking distance? A property with a less than 20 minute commute to your job? Do you need something close to the wonderful trail system in Issaquah and Tiger Mountain? Or perhaps you are envisioning a rural home with property for your flock of chickens and golden retriever to run about.
Is proximity to schools important or proximity to anything else such as other family members or friends?
I also encourage you to determine your transportation options. Not only is I-90 the main thoroughfare to Bellevue and Seattle, but there are also two rapid transit centers in The Highlands and down in Issaquah Valley with Sound Transit. In addition, Light Rail may be coming to Issaquah in the coming years.
Location is one of the most important considerations to make when determining the property specifics!
What Type of Property Do you Want?
Condos can be a great first step towards homeownership. They are generally less expensive and require less maintenance, but usually a monthly Homeowner Association fee for common areas is required. This must be taken into consideration when determining your monthly payment.
A stand-alone home is what most first-time homebuyers strive for as there are generally no shared walls and at least some yard. You should budget at least 1% of the purchase price per year for maintenance and replacement for systems. Stand-alone homes generally appreciate at a higher rate than condominiums.
A duplex can be an interesting option since you can rent out one half while living in the other. However, you get to enjoy the appreciation on both units! It does take a certain type of person to be a landlord and to live next door to your tenant, but a duplex can be a great way to build wealth.
Financing Your Investment
It is important to know where your down payment is coming from as the lender will need to verify the funds are available and that you are not beholden to repay it if it is coming from another person. Here are just a few ways a portion or a whole down payment can be paid.
If you have diligently been saving up for a down payment, have sold other assets or have received an inheritance, you may plan to use your savings to invest in your new home. Your lender may request proof of these funds and want to know from where these funds originated.
Some first-time homebuyers receive a portion of their down payment as a gift, perhaps from parents or another family member. In this case, the lender may ask that the gifter write a letter indicating that the down payment is indeed a gift, repayment is not necessary, and the gifter has no other financial interest in the property.
Some areas have a grant program or special loan program to help first-time homebuyers with their down payment. There may be classes or seminars to attend or separate paperwork in order to be eligible for the program, and the lender will need to be involved early to make sure the loan proceeds as planned.
The great thing about being a first time homebuyer is that without having to sell another home before you buy, you have time on your side. Financially you will have an advantage because your assets are not likely tied up on another property.
Marianne says, “Although you may envision a huge home on acreage, that isn’t realistic for most people for their first home. My advice is to get into a property to build equity which you can use towards your “someday” home. Even if it is not the most ideal home, make the move, and enjoy the property appreciation!”