Buying A First Home, Location Is One Thing, But Preparation Is Another
We all know the old line about location, location, location. But buying a home, whether it's your first home or your twentieth home, also takes research and preparation.
How much can you comfortably afford?
After deciding that you do in fact want to purchase a home, the most important step is the Pre-Approval Process by a qualified (an ideally local) loan originator. This should entail a thorough analysis of your income and asset documentation as well as a credit check. Potential hurdles can be identified and worked out at this stage saving big headaches later on. 
How much cash will you need to close?
Different loan programs have different minimum down payment requirements.
For example, VA eligible homebuyers can purchase a home in San Diego County right now up to a price of $580,750 with zero down payment.
FHA requires a 3.50% down payment. Conventional loans allow as little as 3% for some 1st Time Buyer programs, but a minimum of 10% down payment for a High Balance Conforming Loan.
Also, there are costs associated with purchasing a home. Hard costs such as title, escrow, lender, and recording charges.
And prepaid items like first year homeowners insurance premiums, pro-rated interest, pro-rated property taxes, and impound account set-up for future taxes and insurance if applicable (required for FHA and VA and some Conventional loans).
Do you have these funds as well? Will you need a lender or seller credit to cover some or all of these monies?
Where you want to be and how long you'll want to be there?
You will want to strike a balance between buying what you can afford and buying what will accomodate your needs for longer than just the first few years. Assess your plans for a growing family, if that is part of the plan, and how your income might grow to match.
Planning ahead is especially important in today's low mortgage rate market since trading up tomorrow may mean both a more expensive home and a higher mortgage rate.
How does the process work?
The Internet may know a lot about a lot, but it may not have all of the answers regarding the homebuying process. This process can include the pre-approval, driving around looking at homes, writing an offer, acceptance, formal loan application, inspections, appraisal, title, loan approval, request for repairs, closing/funding, and moving in.
Many little steps can fall in between and the process does not always occur in an exact order, so it pays to speak with LOCAL LENDING AND REAL ESTATE EXPERTS, early.
Reach out when you are ready. We can help you understand the nuances of your market today.
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