030: 5 Tips For First-Time Home Buyers, with Eric Blanchard

Buying a home can be nerve-wracking, especially if you’re a first-time home buyer. Not only is it probably the biggest purchase of your life, but the process is complicated and fraught with unfamiliar lingo and surprise expenses. What if you make a mistake? No need to worry...To make the first-time home buying journey a little less stressful, our good friend and real estate agent Eric Blanchard joins us on this Worth It episode to share five tips to help you navigate the home-buying process!

Here’s What You’ll Learn [3:45] How Eric got started as a real estate agent [5:45] Tip #1- Before you start the search for the perfect house, sit down with a loan officer to figure out what you can afford [8:30] Sit down with your local home-grown bank, it may just work out in your favor [12:30] Tip #2- choose an agent [15:15] Sell by owner: What you should know [17:00] What to look for in a real estate agent [21:45] Before you hire an agent, create your wish list [23:15] Tip #3- Drive the area a few times during the week, at different times of the day [25:30] Tip #4Start the process [27:30] Don’t underestimate sweat equity [31:15] Tip #5- Make an offer [37:00] Rookie mistakes to avoid Research first, dream house second

Tip #1: Before you start the search for the perfect house, sit down with a loan officer to figure out what you can afford

Before you start looking for your dream home, you need to know what’s actually within your price range. When you’re taking out a mortgage loan, your credit will be one of the key factors in whether you’re approved, and it will help determine your interest rate and possibly the loan terms. Check your credit before you begin the home buying process. Dispute any errors that could be dragging down your credit score and look for opportunities to improve your credit, such as making a dent in any outstanding debts. If you’re applying for a mortgage soon, avoid opening new credit accounts to keep your score from dipping. In addition to saving for a down payment, you’ll need to budget for the money required to close your mortgage, which can be significant. Closing costs generally run between 2% and 5% of your loan amount. You can shop around and compare prices for certain closing expenses, such as homeowners insurance, home inspections, and title searches.

You need somebody in your corner

Tip #2: #2 - choose an agent

Real estate agents are important partners when you’re buying or selling a home. Real estate agents can provide you with helpful information on homes and neighborhoods that isn’t easily accessible to the public. Their knowledge of the home buying process, negotiating skills, and familiarity with the area you want to live in can be extremely valuable. It is paramount that you find an agent you feel comfortable confiding in and trusting with the most expensive purchase of your life thus far. Ask for referrals and recommendations from close friends, then start meeting with agents. And best of all, it doesn’t cost you anything to use an agent – they’re compensated from the commission paid by the seller of the house.

The Stakeout

Tip #3: Drive the area a few times during the week, at different times of the day

When deciding where you want to buy your first home, there are a wide variety of factors that will help you make a decision. Even if the price is right, you’ll want to consider other factors, like the neighborhood that house is in. What is the traffic level like in the areas you like best? Not just after work, but in the morning and on weekends. Consider access to shopping, restaurants, nightlife and grocery stores. Will it be expensive to enjoy life in your new neighborhood or affordable? Are there other people around you with similar goals, like raising children? All of these factors should be considered when planning to purchase a house. Great real estate agents should be able to provide some basic information about the neighborhood you are considering.

Start the process

Tip #4: Start the process

Take as much time as you need to find the right home. Then work with your real estate agent to negotiate a fair offer based on the value of comparable homes in the same neighborhood. Once you and the seller have reached agreement on a price, the house will go into escrow, which is the period of time it takes to complete all of the remaining steps in the home buying process.

Tip #5: Make an offer

You’ve done your homework and know your local market. You have a list of sales comparable to the house you’re interested in, and you’re ready to make a smart offer. Your real estate agent can provide you with a Residential Purchase Agreement that complies with applicable state and local laws. In some states, it is common for a lawyer to be a part of the offer paperwork process.

Resources & People Mentioned Eric Blanchard - Agent Profile www.theworthitpodcast.com/30 Connect With Danielle and Dustin Ask your questions! On Facebook On Twitter Connect with Dustin on Twitter: @DRGranger