How to Buy Your First Home (And Why 2017 is the Year of the Millennial Homebuyer)
If you’ve been thinking about buying your first home, now could be a great time to take the plunge. With interest rates expected to rise, locking in a rate on your mortgage early can be a cost-saving move. Also, as rents continue to climb, you might be ready to invest that monthly check in something that can appreciate in value—not to mention something that gives you a tax break come next April.
But today’s first-time home buyers also face a number of challenges—things like rising home prices, decreased housing inventory, increased competition, and financial barriers like student loan debt and limited credit history.
Luckily, these factors don’t have to come between you and your first home. If you know how to navigate them, you can land a home you love without breaking the bank.
Our updated guide to First Time Home Buying, will show you how to buy your first home without breaking a sweat.
Here are five quick tips from the guide to get you started.
1. Take the emotion out of it. Determining whether it’s time to buy a home is both an emotional and financial decision. Start by figuring out if the finances make sense, then evaluate the emotional factors.
2. Lay the groundwork. Taking time up front to gather paperwork, get pre-qualified and other steps can make the home buying process easier and more enjoyable. Plus, you’ll be ready to act when you find that dream home.
3. Evaluate your mortgage options. Different types of home loans (e.g., fixed vs. variable rate) offer various pros and cons. Consider your financial goals and your long-term plans, then choose a mortgage option that best supports those goals.
4. Choose a good lender. With the rise of online and marketplace lenders, there’s increased competition which fuels improvements in process, service, and cost. To avoid getting stuck with a not-so-great lender, take the time to shop around.
5. Respect the inspection process. Include a home inspection as a contingency clause when you present your offer—it’s crucial to identify potential issues that could require expensive repairs down the line.
If not now, when?
Between the current economic environment and the advent of new mortgage products, this could be a great time to take the leap from renter to homeowner.
Download the SoFi Guide to First Time Home Buying to get valuable tips on these topics and more. Our guide also demystifies modern mortgage myths around down payments, the pre-approval process, student loans, rising interest rates, and more.