For most newlyweds, buying a home is the next big step. While purchasing a home is not easy, the result of building memories in a new house and starting a family is very exciting.
The home buying process can be long and tedious, specifically for first-time homebuyers. Having little to no experience in the housing market can make this goal seem overwhelming, especially if you are still paying off your wedding or other debts you might have. Understanding credit scores, budgeting, loan options, and other circumstances that make up the home buying process is a great way to help you navigate this journey and ensure you are making all the right decisions. Below are a few helpful tips to help you navigate buying your first home as newlyweds.
Much like hiring a wedding planner to help organize and arrange your special day, one option to help you through the buying process is to hire a real estate agent. There is a lot of information that you may not be aware of or fully understand, such as home appraisal and closing costs. Having a real estate agent is also handy because the buyer doesn’t have to pay for the agent, rather the seller typically pays for the transaction, so it doesn’t have to be a factor in your budget.
While looking to purchase your first home, it’s key that you can trust the agent. Asking a real estate agent questions is key to helping you find the one best fit for you and your spouse. Remember that it’s okay to talk to a handful at a time to ensure you choose the right agent to fit the needs of you and your partner.
Just like creating a wish list for your wedding, you may want to put together a list of features you want in your first home. Creating a wish list is an easy way to see each other’s wants and requirements so you can prioritize the characteristics in your future home and help you determine your ultimate budget. Some items to include on your wish list to help you best determine what type of home you want to live in could be the style, size, location, and age of the house.
An important consideration is the geographic area you want to live in. One factor to help with this decision can include the proximities of your workplace or friends and family. Another element to consider is whether you have, or plan to have children, and what school district the property lies within. If you are unsure of how to find good schools nearby, try using a school tracker tool to help you locate different options around your desired area.
Evaluating your financial situation as a couple allows you to see your best price range and what options are available to you. Your credit score is a critical component of buying your first home because it shows lenders your ability to pay off debt. So, what credit score is needed to buy a house? Your credit score is a number that ranges from 300-850. Both partners need to be willing to sit down and be completely honest with each other about the state of their separate finances because many don’t realize that your spouse’s credit score may impact what lenders are willing to offer you.
The good news is that there are some government-backed loans that have lower credit score requirements that you can qualify for if you do happen to have a poor financial history. One noteworthy loan option that often appeals to first-time homebuyers is an FHA loan. The reason this loan option is so appealing is that it’s backed by the Federal Housing Administration and has a minimum credit score requirement as low as 580. Since this loan is backed by the government, there is usually more flexibility in its repayment plans than with some conventional mortgages. Along with that, USDA loans are also worth exploring. Typically, USDA loans require a credit score greater than 640, but it does offer the possibility of no down payment.
Now that you and your spouse have an idea of your financial situation, the next step is to consider a timeline. As we all know, weddings can be costly, and paying off those expenses may affect your home buying budget. But just as you created a wedding budget, you’ll want to do the same planning now.
Although you may want to purchase a home as soon as possible, it’s important to not rush the process. There are many factors involved with buying a home that you don’t have control of, such as the real estate market. So, while you’re setting an ideal timeline, it’s essential to evaluate the circumstances in the area you are searching for.
Once you have found a home you are interested in buying, you can choose to have the home inspected before you make any offers. A home inspector is a professional that will assess the home and inform you of any red flags it might have. The reason it’s important to have a home inspection is that you don’t want to make an offer on a home that will cost you more money in improvements than you might have.
Purchasing your first home will be the start of a new beginning with your partner, so try to find a house that is suitable for both of your needs. Not only should the home fit your needs now, but it should also live up to your expectations in the future, especially if you plan to grow as a family in it.
When you and your partner find a home that seems like the one, your real estate agent will help you put together an offer. The waiting period to hear back from the seller may take some time. They will either accept, decline, or negotiate with you. Be prepared if there is a bidding war because that may drive up the cost.
Along the way, there will most likely be a few roadblocks, but don’t let that discourage you. Buying your first home as a newlywed couple is one of the most memorable moments in your life, so don’t forget to enjoy the journey.