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Top Tips for Buying Your First House

Thinking about making the giant, terrifying, and oh-so-rewarding step of buying your first house? It might seem incredibly daunting, but thousands of people do it every year.

If you’re overwhelmed and don’t know where to start, we’ve got some tips to put you on the right path and get you ready for this big commitment. Buying your first house is probably going to be the biggest financial transaction you’ll make in your life, but the title of homeowner is hard to resist.

Realize That Compromise Happens

Television shows like House Hunters on HGTV have spawned thousands of memes about budgets and questionable mortgage tactics. It’s important to remember above all else that shows like this are for your entertainment and will offer very little actual help when buying a house.

You’re going to have to compromise. Maybe a lot! This is your first home. Very few people live in the first home they purchase for the rest of their lives. That’s why it’s often called a “starter home.”

You might not get your large kitchen island, granite countertops in the bathroom, or a full finished basement in your budget and area. Adjusting your expectations accordingly will make the whole process significantly easier.

Make two separate lists – a must-have list and a want list. Your must-have list needs to be everything that you absolutely need in a home. Maybe it’s 3 bedrooms instead of just two, or a full formal dining room so you can host Thanksgiving. Whatever you need in a home goes on that list.

The second list, the want list, can be a little beefier. Whether it’s a farmhouse sink, stone countertops, a white kitchen, a bonus space… your list can be whatever you like. Think of items that would be nice but are not absolutely needed right away.

Have Vision: This Could Be the Long Game

Remember that this is the long game you’re playing. This is a home you are going to live in for several years, which is a long time to plan, adjust, and more importantly, make it your own.

Maybe the kitchen isn’t perfect. Or the basement needs to be finished. The attic space is a little tight and needs work. That’s all okay – if you can live with it for now you can put money back into the house with improvements and upgrades.

Sure, buying everything move-in ready and absolutely perfect is the dream. But that dream comes with a price tag, and you don’t want to spend so much on your new home that you’re house poor.

Watch Your Credit

Credit scores are confusing, temperamental, and sometimes terrifying. But they’re also very important to buying a home. Getting your mortgage approval will depend heavily on your credit score.

Check your credit score early, and start paying down debt to help boost those numbers. Any questionable debts or cleared items should be disputed so that they are removed from your report long before you move forward with the process.

When you go to apply for mortgages with your bank or lending office, pause any other credit accounts. Don’t apply for a car loan or get a new credit card until your loan completely goes through and you’re in your new house. This is going to help you get the best rates–and keep them.

Don’t Spend All Your Savings on the House

There are a lot of expenses as a new homeowner that you may not be expecting. One couple dumped almost all of their savings into their down payment, and they got a great mortgage rate… but then they barely had enough extra money left over to paint their walls.

It’s almost guaranteed that you’ll encounter surprises when you move in. Replacing that dishwasher a month after you move in or fixing a faulty fireplace will eat into your budget. Not to mention you’ll be buying new furnishings or embarking on home improvements that will improve your quality of life.

Make sure that you still have some healthy cushion before dumping all of your money into the house!

Ready To Buy? Know What Your Home Inspection Includes

A home inspection is completely standard when you’re buying a house. Here’s what you need to know before you move forward.

Discuss with your home inspector what is included, and what isn’t. Be sure that they are able to see the whole house, including any crawl spaces, attic spaces, etc. Some inspections don’t include testing for mold or radon. Some won’t look for pests, like termites or signs of rats.

If you see something questionable, like a crack or water spot, feel free to ask questions about it. Your home inspector is there for you.

Homeowner’s Insurance Should Not Be Skipped

Look, no one ever says “Oh yay! Our homeowner’s insurance bill is due!”

But homeowner’s insurance is so incredibly important. Skimping out, especially at first when you don’t know what to expect from your new home, is a serious no-no. Make sure that you shop around, but don’t always go for the best rate available. Compare your coverage, too.

Struggling? Consider asking the current owners who they use for their insurance and what their coverage is. Chances are they have worked out the kinks.

And finally, make sure you get flood insurance if you even think it might be necessary. Often, the typical home insurance policies do not cover water damage for flood-prone areas. You should find out if your new home is at risk and get that coverage. It might just take one 100-year storm to really ruin your week.

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