Purchase Your First Home in Chesterfield with Confidence

If you are making the transition from renter to homeowner, you're not alone. In 2004, 40 percent of homebuyers were purchasing for the first time, according to "The 2004 National Association of REALTORS^® Profile of Home Buyers and Sellers."

With interest rates at all-time lows and a booming real estate market, now is a good time to purchase real estate. However, with the prospect of making one of the largest investments you'll ever make in your life, you can easily become overwhelmed. Some of the questions you may be asking are:

• Will I be able to afford the home of my dreams?
• Do I have enough money for a down payment?
• Will I make smart home buying decisions?

If you go into the process prepared, your first purchase can be a good experience.

Resources

Before starting out, educate yourself on the process. The U.S. Department of Housing and Urban Development has an entire section on its website (www.hud.gov) devoted to homebuyers. It has a list of common questions of first-time homebuyers, information on mortgage and home-buying programs, access to housing counselors, downloadable tools such as a wish list and home-shopping checklist, tips on selecting a real estate professional, etc. Another informative site to check out is www.ginniemae.gov. Also, be sure to review all of the applicable articles on this web site.

Your Realtor^® is also a great resource. Don't hesitate to let them know that you are new to the process. They will expect you to have questions at each step-from house hunting, to making an offer to the closing.

The costs involved in the purchase of a home can be overwhelming to first-time homebuyers. There are mortgage costs, the down payment, and closing costs to think about.

Affordability

By looking at your income and debt ratio, your Realtor^® can help you calculate how much you can afford each month in mortgage payments or you can use our calculator to do it yourself. However, before determining your price range, you should also take into consideration other factors that will affect your monthly budget once you are a homeowner, such as property taxes, insurance, utilities, and maintenance. In addition, if your down payment is less than 20 percent of the cost of the home, you will may be responsible for private mortgage insurance, more commonly referred to as PMI.

Mortgage payment

Fear of being rejected for a home loan is one of the main concerns for first-time homebuyers. To lessen the stress, and to strengthen your purchase offer, you should get pre-approved for a loan before looking at prospective homes. This will not only help you feel more confident, it will also give you an advantage where there are multiple offers for a specific property. In addition, the fact that your loan has already been approved is of great value to the seller because it shortens the purchase process, and there is less of a chance that the buyer will back out of the sale. If you do not have a specific mortgage lender in mind, ask your Realtor^® for a recommendation. Let us know what you are looking for, and we will be glad to help.

Down payment

The down payment amount varies depending on the value of the home you choose and your mortgage lender. Moreover, in some cases, first-time homebuyers can purchase a home with no money down. Although it varies from state to state, most offer government-funded programs for first-time buyers that help people buy a home with no down payment. If you do not have a specific mortgage lender in mind, your Realtor^® will be able to put you in touch with reputable lenders that can explain the alternatives. Let us know what you are looking for, and we will be glad to help.

Making Offers

Do not feel pressured into making an offer on the first home you see. This is a common mistake of many first-time homebuyers. Make sure you view different homes to get a feel for the marketplace. When you decide on a home to make a bid on, work with your Realtor^® to get all of your questions answered before making an offer. But don't wait too long to make an offer. The longer you wait, the greater the chance other prospective buyers may place offers, making it harder for you to negotiate a good deal.

Above all, remember there are no silly questions. Make sure you understand and are comfortable with every aspect of the transaction. Your Realtor^® can be an invaluable asset in helping you make educated decisions so that your first home purchase is a rewarding experience.

Please feel free to call us at (636) 861-3790 or contact us on the web.