First Time Home Buyers Start Here

Helping Clients with their journey to find their FIRST HOME



I. WHAT A FIRST-TIME HOMEBUYER NEEDS TO KNOW BEFORE STARTING

Before diving in, it’s critical to understand the basics:

1. Homeownership vs. Renting
• Pros of Owning: Building equity, stability, potential appreciation, tax advantages.• Cons of Owning: Maintenance costs, less mobility, upfront expenses.
2. Understanding the Costs Involved
• Down Payment: Typically 3%–20% of the home’s price.• Closing Costs: 2%–5% of the home’s price (lender fees, title fees, inspections, taxes).• Ongoing Costs: Property taxes, homeowner’s insurance, utilities, maintenance, HOA fees if applicable.• Private Mortgage Insurance (PMI): May be required if putting less than 20% down.
3. Credit Score & Debt-to-Income Ratio (DTI)
• Most lenders require a minimum credit score of 620 (some FHA loans accept as low as 580).• Ideal DTI ratio should be under 43%. 4. Types of Mortgage Loans
• Conventional: Not government-backed. Often requires good credit.• FHA: Great for first-timers with lower credit.• VA: For eligible veterans. No down payment.• USDA: For rural areas. Zero down for qualified buyers. 5. Pre-Approval vs. Pre-Qualification
• Pre-qualification: Initial estimate based on self-reported data.• Pre-approval: Verified and more credible. Stronger when submitting offers.


II. WHAT A FIRST-TIME HOMEBUYER NEEDS TO DO TO GET STARTED

✅ Step 1: Evaluate Your Finances
• Review your income, savings, and expenses.• Check your credit report for errors and correct them.• Pay down debts if possible to improve DTI.
✅ Step 2: Determine Your Budget
• Use a mortgage calculator to estimate what you can afford.• Consider all monthly costs: loan payment, taxes, insurance, HOA, utilities.
✅ Step 3: Get Pre-Approved for a Mortgage
• Gather financial documents: pay stubs, tax returns, W-2s/1099s, bank statements.• Shop around and compare loan rates and terms from at least 2–3 lenders.• Get a pre-approval letter to strengthen your offers.
✅ Step 4: Hire a Real Estate Agent
• Find a trusted, experienced buyer’s agent (like Dr. Brian Jones) who understands your local market.• Your agent will guide you through everything — home searches, offers, negotiations, inspections, and closing.

III. THE COMPLETE STEP-BY-STEP PROCESS TO BUYING A HOME

1. Home Search & Viewing

🔍 Step 1: Make a List of Needs vs. Wants
• Needs: Bedrooms, accessibility, school districts, work commute.• Wants: Pool, large yard, updated kitchen.
🗺 Step 2: Start Touring Homes
• Your agent will send listings.• Visit properties in-person or via virtual tours.• Take notes and photos to remember each.

2. Making an Offer
✍️ Step 3: Decide on an Offer Price
• Your agent will perform a Comparative Market Analysis (CMA) to ensure you’re offering appropriately.
📄 Step 4: Submit the Offer
• Includes price, contingencies (inspection, financing, appraisal), earnest money deposit, and proposed closing date.
🤝 Step 5: Negotiations
• Seller may accept, counter, or reject.• Your agent will guide you through back-and-forth until mutual agreement.

3. Offer Accepted! Now What?
💰 Step 6: Deposit Earnest Money
• Typically 1%–3% of purchase price held in escrow.• Shows you’re serious and goes toward your closing costs.
📝 Step 7: Finalize Mortgage Application
• Submit additional documents to your lender.• Lock your interest rate.• Lender orders the home appraisal.

4. Due Diligence Period
🔍 Step 8: Schedule Home Inspection
• A licensed inspector checks the home’s condition (roof, plumbing, electrical, HVAC, foundation).• You’ll receive a full report.• Renegotiate or request repairs if needed.
🧾 Step 9: Review Property Disclosures
• Seller must disclose known issues: structural, water damage, mold, pest infestations, etc.
📏 Step 10: Appraisal
• Required by the lender.• Confirms the home’s value supports the loan amount.• If appraisal is low, negotiate or bring more cash.

5. Preparing to Close
📑 Step 11: Title Search & Insurance
• Title company checks for legal ownership and any liens or disputes.• You’ll purchase title insurance to protect yourself.
🧾 Step 12: Homeowner’s Insurance
• Required by lenders.• Choose a policy before closing.
🏦 Step 13: Final Loan Approval (Clear to Close)
• Underwriter gives the green light.• You receive your Closing Disclosure (CD) at least 3 business days before closing.• Review carefully: interest rate, loan amount, payments, closing costs.

6. The Final Stretch
🚪 Step 14: Final Walkthrough (Typically 24–48 hours before closing)
• Make sure agreed repairs were completed.• Ensure property is in the expected condition.

7. Closing Day
🖋 Step 15: Sign All Final Documents
• Mortgage documents, deed, disclosures, etc.• You’ll sign either in person or electronically, depending on local customs.

💵 Step 16: Pay Closing Costs
• You’ll wire or bring a cashier’s check for the down payment and closing costs.
🏠 Step 17: Receive Keys
• Once funds are disbursed and documents recorded, you are officially a homeowner!
IV. POST-CLOSING TIPS FOR FIRST-TIME HOMEBUYERS
🔑 Change locks and security codes.
🧾 File your homestead exemption if applicable.
💌 Update your address with USPS and all institutions.
🗓 Set calendar reminders for:
• Property tax deadlines• Annual HVAC maintenance• Mortgage escrow review
🏠 Start a home maintenance checklist to protect your investment.
📞 Need Help?
If you’re ready to begin your journey, I’m here to help guide you every step of the way.Dr. Brian Jones, REALTOR®Military Relocation Professional | SRES | PSA | GREEN | AI CertifiedPlatinum Realty | Ryan Hutsell Properties Team📞 Call or Text: 913-568-4300📧 Email: brian@brianjonesconsulting.com
Helpful Resources for Veterans: