It's time. You're tired of renting, you're tired of roommates, you're tired of not having something to call your own. It's time -- time for your first home. This is one of the most exciting times in your life, but its also filled with apprehension and confusion. Let's relax and try to make it easier for you.
Who are first time home buyers?
First timers are typically anticipating a major life event like an upcoming marriage, birth of a child or completion of school. They are most likely currently living with friends or relatives in a rental property. The best attribute of the first timer is that they value the emotional and financial benefits of owning a home (i.e. personal satisfaction, pride, asset building, etc...)
What do first time home buyers want?
If you're a first timer, you know exactly what you want, but you might not necessarily know how to go about getting it. Today's first timers are more and more savvy than ever before, with the majority of first timers doing an extensive amount of research on the internet before contacting a Realtor. First timers want and need a broad array of products, with clear explanations of the entire process from offer to possession.
Debunking Financing Myths
One of the first things a first timer will need to do is get pre-approved for a loan. These days, there is a lot more honesty and transparency required on your part, but if your financial house is in good order, you have plenty of great options. Think you need to put 20%+ down on your first home? For younger first timers, coming up with that huge down payment is usually prohibitively expensive. 20% is not the norm!
FHA (the Federal Housing Administration) provides loans that require a minimum of 3.5% down, with a minimum credit score of 600 and mortgage insurance paid up front monthly. For those who have served in the military, VA (The Department of Veterans Affairs) loans are available for 0% down with any credit score (up to home value of $700k) and. Conventional financing requires 5% down for first timers with a minimum credit score of 620 with mortgage insurance paid monthly. One of my favorite loan options is USDA financing. This type of loan is typically used in more rural areas (i.e. Weld County) but can also creep into the boundaries Fort Collins, Loveland, Greeley and Windsor. This loan requires 0% down with a credit score of 600. There are published maps of areas that the USDA provides these loans. Don't let anyone tell you that you need a hefty chunk of money to put down on a home. You can afford a down payment, and you can find a great home for nearly the same as what you're renting for right now.
What to do next
A Realtor is going to be able to put you in touch with everyone you'll need to be in contact with. Take your time, do your research online, and contact a Realtor to get the process started if you're ready to make your dreams into a reality. If you have any questions, I'm always here to answer them for you -- and the next time you come across someone who is tired of renting and wanting to get into a new home, pick up the phone and call me to let me know how I can help them.