Tips for First-Time Homebuyers

Buying your first home can be an overwhelming process. While there are many factors that go into buying a house, there is one thing that is most important in your search – price. In order to find the right home, you have to know what you can afford to buy.

Follow these tips to know how much you can afford to pay for your first home:

1. Calculate monthly payments.
   Ask yourself, How much can I reasonably afford to pay each month?
   Make a spreadsheet of all your bills and expenses, (including an estimate of utilities in the new home). Be sure to include things you spend money on in daily life, like groceries, clothing, movies, restaurants, etc. Subtract the total of a month’s worth of bills and expenses from your monthly income, to see how much you can afford to pay for a house, under your current lifestyle. Many experts say you should expect to pay 25-30% of you monthly income on your mortgage, but for many people, 30% is too high. Figure out what is a comfortable monthly payment for your and your family. You don’t want to lose sleep over whether or not you can pay your mortgage each month, so plan your budget wisely.

   See also: 8 Reasons You Should Buy a Home Instead of Renting

2. Save up for a down payment.
   Setting aside 20% of the home’s cost for a down payment is a very safe number to go by. If you cannot afford that much, don’t fret. There are many ways to buy a home with less and even no down payment, although your interest rates may be higher and you may have to pay for private mortgage insurance (PMI). Talk to different lenders to see what kind of deal is best for you.

   Others also found helpful: What to expect in closing costs when buying a home
   

3. Learn about property taxes.
   Most of the time, property taxes will be added to your monthly mortgage payment. Check the county auditor’s website to learn the amount you should expect to pay in property taxes each year.
4. Get an estimate for home owners insurance.
   This is usually added to your monthly mortgage payment as well. Call your current insurance company or shop around for the best deal for your needs.

   You may also find helpful: 6 Steps to buying a home

5. Add it all up.
   With all your monthly payment data, find a reliable mortgage calculator and determine the overall home price range you and your family would feel comfortable paying.
   Now, with the price range in mind for your new home, you can begin confidently speaking with a realtor and looking at homes to buy.

For all your real estate needs, contact expert DFW realtor, Stacey Perry with Keller Williams Realty, today!

Phone: 817.313.1833
Email: staceyperry@kw.com
Website: Stacey Perry Team
Facebook: Stacey Perry Team-Keller Williams Realty
Twitter: Stacey_kwrealty
Instagram: StaceyPerry_kwrealty
Blog: Stacey Perry Team