So, you’ve just tied the knot with your favorite person and are still basking in the glory of your wedding. Congratulations, you’ve overcome your first obstacle, planning the wedding. Now you must confront your next obstacle: buying your first home. As newlyweds, you may feel overburdened by all the advice from friends and family who consider themselves ‘experts’ in real estate. Don’t let them ruin this exciting experience. You should be celebrating that you’re looking to purchase a home together rather than letting it stress you out. To ensure the process moves along swiftly, here’s our first-time home buyer for married couples guide.
1. Review Your Financial Situation
Before you can begin exploring and comparing different house designs, sit down with your spouse and review your current financial situation. Have a serious discussion about your budget without letting your emotions cloud your judgment. Decide on a price range that’s within your budget. Next, evaluate your joint and individual financial situation.
This will help you decide whether you can immediately buy a home or whether you’ll need to get a loan, often known as a mortgage. Set aside some funds to cover a down payment. Lenders frequently require a 20% down payment of a home’s value. According to Muzz, a study revealed that 88% of American home buyers choose to finance their purchases with a mortgage. Around 35% of them have put down a 20% deposit.
2. Improve Your Credit
Most credit sites state that a credit score in the high 500s or low 600s is the absolute minimum needed to get mortgage approval. However, you’ll need a considerably higher credit score to be eligible for the best loans and deals. Start polishing your credit score right away because, while it’s not a complicated process, it can take months. Pay your bills on time, reduce your debt-to-income ratio, and double-check your credit report to flush out errors.
3. Pay Off Outstanding Debt
Not only will paying off outstanding debt raise your credit score, but it will also increase your appeal to lenders. Lenders are hesitant about giving loans to people who already have debt as it seems less probable they’ll get their money back. When applying for a mortgage, your lender will assess your debt-to-income ratio. If it’s too high, you’re unlikely to be approved. Lenders consider all forms of debt, including credit card debt, personal loans, auto loans, and other debts. To qualify for the best mortgage terms, pay off all your outstanding debts.
4. Consider Your Financial and Family Goals
In addition to establishing your overall spending budget for the purchase, consider your long-term financial and family goals. For instance, you may want to pay off outstanding debts or store money for rainy days. If you intend to expand your family eventually, prioritize issues that might ultimately result in higher costs. For instance, if you plan to have more children, you’ll need a larger home that’s close to a school. Another important thing is planning how you’ll handle your finances if your partner quits their job to care for the kids. Ensure you’ve hushed out all these essential details with your partner beforehand.
5. Pre-Qualify Yourself for a Loan
To pre-qualify for a loan, your lender will estimate how much you’re entitled to by looking at your debt-to-income ratio. This can help you determine how much you can spend. To convince lenders to finance your home purchase willingly, you need strong credit on both accounts, and in some cases, yours or your partner’s will suffice. The typical down payment for prospective home buyers with decent credit scores can be as little as 3%. Your net income determines whether a mortgage lender will approve your application or not. When conducting your analysis, ensure your monthly mortgage payment is not more than 20% of your gross income.
6. Find a Qualified Loan Officer
A loan is generally the preferred mode of financing for people looking to buy a home. However, with factors such as payback periods and interest rates, among other things, loans come with a lot to consider. A competent loan officer can provide you with the right advice in this regard. Therefore, look for a loan officer who is informed about all matters to do with a home loan and can help you get the best deal on a property you’re considering purchasing.
If your loan officer doesn’t fully disclose the terms and conditions of the loan and keeps you in the dark throughout the process, you will suffer. It’s your responsibility to comprehend all the terms and conditions of a loan. One of the best first time home buyers for married couples tips is to ask prospective loan officers as many questions as you want. If you feel like all your questions are being answered, it’s a good sign that you won’t run into any problems going ahead.
7. Put Together a Wish List
The fun part of owning a home is that you’ll have the freedom to decorate it to your liking. Having a home with a lush outside setting or a roomy interior depends on your preferences and your budget. Sit down with your spouse and list your needs and wants for the new home.
Purchasing a home has several moving parts that can be challenging to navigate for anyone. However, newlyweds who are already dealing with a lot of choices and decisions to make may find it particularly difficult. Regardless of how strong your bond is, the hunting and purchasing process can drive even the most loving couples into a spiral. You may find that your partner insists on a modern home design, but you want something more traditional, or you want to move to the suburbs, but your spouse is forever a city girl.
This is the ideal moment to take out your lists (or create them if you haven’t already) and look at your prioritized factors. Whether it be size, price, renovation needs, style of home, or location, a little compromise is required from all sides. After comparing your lists, decide what matters most to you both. Finding common ground will facilitate combined, realistic goals. If you feel house hunting is causing undue stress on your new marriage, consider taking a break. Think about how much you can compromise, and when you’re ready, you can get back to your search with a positive outlook.
9. Find a Trustworthy Real Estate Agent
After making a list of your ideal home’s features, it’s time to look for a seasoned real estate agent who can help you find the home of your dreams. This agent should have extensive knowledge of all matters to do with real estate. An expert real estate agent with in-depth market knowledge will help you negotiate for the best price. They’ll also take into account the cost of renovations if applicable. The best place to find a trustworthy real estate agent is to speak with recent homeowners among your friends, family, or relatives. You can also look for reviews online. Realtors are like brand-new boots. If they don’t fit properly, you’ll suffer a lot. While prioritizing your needs and wants, your real estate agent should also be punctual.
If weeks go by without your agent checking in with you or responding to your inquiries, start looking elsewhere. Don’t be afraid to look around for a better agent; it’s your right. Be as picky as you need to be since this individual will be partly responsible for finding your dream home. You’ll also want to ensure that the agent you choose offers the greatest value. An agent may provide what is known as a buyer commission rebate in 40 of 50 states. This allows an agent to pass some of their commission, up to a staggering 1% of the purchase, to you. On a $200,000 home, that’s $2000 in your pocket at closing. This extra cash can come in handy when renovating your new home or during your move. Ask your agent if they offer this option, as most of them won’t advertise it. An agent who wants your business will be happy to negotiate a rebate for you.
10. Establish What Features You’re Looking For
Even under the best of circumstances, house hunting can get overwhelming. Going blind will just make the process more complicated. Sit down with your spouse and note the features you’re looking for in a home. Make a list and divide it into ‘must-haves’ and ‘wants,’ just like with your list of wedding priorities. Afterward, you can use the list to compare different homes and neighborhoods. Give your real estate agent a copy of your list so they can better understand what you’re looking for.
11. Carefully Review the Location
You should always investigate any offer in person before placing a bid. This gives you a better insight into the neighborhood. If you like maintaining a healthy lifestyle, you may want a home that has a field track close by to meet your daily exercise routine needs. If you and your partner are shopaholics, a home close to the high street will be a great fit. The ideal location for your home is a neighborhood with spacious streets, a welcoming community, and nearby grocery, health, and educational facilities.
12. Budget for Homeownership Expenses
As potential new homeowners, provide for homeownership costs in your budget. Most first-time home buyers are way under budget because they fail to include homeownership costs. In addition to obvious costs such as down payments and closing costs, there are more expenses involved when you purchase your first home. Remember to include expenses like property taxes, energy bills, regular maintenance, house insurance, and maintenance fees. In the first year, most people will invest $5,000 to $10,000 in their new home.
These expenses often go towards maintenance needs such as hiring lawn mowers, a professional HVAC company, lawn maintenance professionals, chimney cleaning services, emergency repair experts, local septic tank repairs, or customization expenses such as installing custom window blinds or you might want to spruce up your yard with an aluminum patio cover. Set aside at least that amount to avoid incurring more debt than you need to. Don’t forget to find a heating oil delivery company. This first time home buyer for married couples tip will prepare you for your first year as homeowners.
13. Don’t Rush
A year before their wedding, most couples deal with a lot of pressure. Don’t put yourself under unnecessary stress by trying to find a home right before or after the wedding. Buying the wrong home isn’t a mistake you can easily remedy. Set aside enough time to search for the home of your dreams. Resist the pressure to own a home at a particular time. Just be persistent and patient; you’ll know when you find your dream home. This is one of the best first time home buyers for married couple tips.
14. Your Relationship Matters
One of the most important joint decisions you’ll ever make as a couple is purchasing a new home. Make sure this choice has a solid foundation. The decision you make will establish a solid foundation for your marriage, and this is critical since financial matters can destroy a marriage faster than anything you can think of.
15. Get a Home Inspection
Don’t skip this step whatsoever. Although most homeowners overlook this step, it minimizes property-related hazards. You’ll likely need to hire local roof repair companies. A home inspection can reveal the need to contact local electric repair professionals, or a garage door business. Several private firms offer comprehensive full-home inspections to identify safety-related issues and provide certification of the same.
Negotiating is always an option, and sellers always leave some room for this. To sell the property for the most money, the price is typically set as high as it can go. This means you can always bargain for a lower price. Don’t rush things; the last thing you want is to appear desperate. Be patient. This allows you to successfully close the deal at the lowest possible price.
Finding and purchasing a new home is a thrilling but overwhelming process, especially for newlyweds. Finding the ideal home is probably your first shared accomplishment. It serves as a space for you and your spouse to discuss, plan, and carry out your long-term family goals. With these first-time home buyer for married couples tips, you can make the most of your first purchase as a couple. Welcome home!