First-Time Home Buyer Guide

Planning to Buy

1. Start Saving Now
   When you buy a home, you’ll need cash set aside for expenses such as your down payment and closing costs. But you’ll also need to have funds for the things most people don’t consider: moving expenses. You may need to pay utility deposits, buy furniture, window coverings and more, not to mention the cost of physically moving your household. Have a nest egg to use during this time.
2. Decide How Much You Can Afford
   When determining your budget, keep more than the cost of the property in mind. Items like HOA fees, taxes and insurance, and utility costs add up quickly. You may also be approved for more than what you can comfortably afford. Use tools like our Home Affordability Calculator to determine your price range based on factors such as income, debt, down payment, monthly bills and property tax.
3. Get Your Credit in Check
   Knowing your credit score and having a clean – or as best as you can get – report is vital when purchasing a home. Borrowers are allowed one FREE credit report per year, and you can sign up for credit monitoring services. Be sure to monitor your credit for any irregularities or delinquencies that could cause a denial or higher interest rate. If you identify errors, work to correct them before applying for a loan. An identity protection service is a great tool to monitor your credit and stay safe from identity theft.

Start Shopping

1. Choose the Right Real Estate Agent
   Finding a good agent and determining compensation is important. You should be aware that if you visit homes with an agent before signing a contract, the agent may consider there to be a verbal contract in place, as they are taking the time to show you a home. Commissions are generally negotiable and do vary geographically. The total commission – for both the buyer’s agent and seller’s agent – is typically paid by the seller at closing. Use our HomeAdvisor tool to connect you with local experts and giving you cash rewards at closing^*!
2. Stick to Your Budget
   You set your budget, now stick to it. As mentioned before, you may qualify for a higher mortgage than what you determined was comfortable for yourself. It can be tempting to accept the full amount when you feel pressure to beat another buyer’s offer. Remember to give yourself wiggle room and look at properties below your personal limit so you can make a competitive offer while staying within your budget.

^*Cash rewards only available in 42 states. The following states do not allow cash rebates to real estate customers: Alaska, Iowa, Kansas, Mississippi, Missouri, Oklahoma, Oregon, or Tennessee.