The unexpected costs of buying/owning a home in Oregon are a fact of life. Whether you own your home or are looking to purchase read about the surprises you can expect to face as a homeowner. From lightbulbs to roofing repairs let us help you prepare with first-hand knowledge from the housing experts.
Are you a first-time homebuyer looking to purchase your first home in Seattle, WA? If so, you’ll want to gather as much information as possible to ensure that you make a sound purchasing decision. This article will provide tips to help you do just that.
In This Article:
- Why Is Managing Your Finances And Credit Score Through The Entire Process Crucial?
- How Can You Get The Best Mortgage For Your Needs?
- Why Is A Local Agent And An Experienced Lender Imperative For Your First Home Purchase?
- What Else Can You Do To Ensure That You Have Found The Right Home And Neighborhood For You?
It’s been a long time dream of yours, and now you’ve decided to make it happen. You’re excited, nervous, and maybe even a little overwhelmed. Whether you’re in Bellevue, Kirkland, Seattle, or any other surrounding areas, there’s a lot that goes into buying a home in Seattle, and it can be confusing at first. With some due diligence, though, you can be enjoying your new house worry-free in no time.
Follow these six tips to help the process go as smoothly as possible when making your first home purchase.
1. Your Credit Score
When it comes to qualifying for a Kirkland, Bellevue, or Seattle mortgage, your credit score is the most important factor for your eligibility. Obtain a copy of your most up-to-date credit report, look for any mistakes or unpaid accounts, and if there are any, and get them fixed as soon as possible. If you have damaged credit, begin the repairing process at least six months before you plan to make your home purchase.
2. Find Out What Mortgage You Qualify For
Before going on your house hunt, it’s imperative to know a general idea of how much you’ll be able to borrow from lenders. Your mortgage will vary depending on factors such as credit score, income, how long you’ve been at your current employment, and other debts you currently owe. There are several different kinds of mortgages to choose from. Finding the best one for you will help boost your chances of approval.
Related: Mortgage loan programs
3. Know Your Budget
Often, home purchases become emotional. You’re making a decision that will likely affect where you could be living for the next couple of decades, so, of course, you want to get everything just right. It’s essential, however, to be realistic. Make the home search easier on yourself by clarifying exactly what you can afford so you aren’t wasting your time looking for places over your budget.
Your pragmatic research will get you into a house and help you begin building your equity sooner than later. There will be additional housing costs that you’ll want to remember to plan for, such as insurance, HOA dues, and property taxes. Track your monthly income, expenses, and make educated projections for how a mortgage will fit into your budget.
4. Identify Your Down Payment
It can take a chunk of cash to make the down payment on a house. 20% of the home’s purchase price is often considered the industry norm. If you don’t have that kind of reserve on hand, no need to panic, there are other options available and loan programs offered for different credit levels. You should also make it a point to check out the Washington State Housing Finance Commission’s (WSHFC) programs like the Home Advantage program and the House Key Opportunity program to help make your homeownership dreams a reality. There are also FHA down payment assistance grants—ARCH East King County, Bellingham, Pierce County, Seattle, Tacoma Down Payment Assistance Programs, and more.
Related: Read this before you put down 20%
It’s wise to have a general idea of where you want to live, and then to investigate it thoroughly. Get to know your preferred neighborhood as if you’re already an inhabitant. Visit it during different times, evaluate things like traffic, as well as proximity to daily amenities and quality schools nearby. Chat with your potential neighbors and get their perspective on the area. These actions can give you a realistic, down-to-earth point of view on your sought-out region.
6. Go Local With Your Agent
Once you’ve found your most desired location to buy, find a trustworthy real estate agent that specializes in that area. It’s advisable to work with someone who you connect with on a personal level, who you feel understands what you’re looking for and has your best interest in mind. Find an agent who’s worked in your preferred location extensively and can share insights on things such as new developments, taxes, and other issues that may affect the market value of the homes you’re browsing.
7. Watch Your Bottom Line
It is highly recommended that you and your lender agree to a certain ceiling (a number you cannot go over) when you purchase your first home. This will allow you to essentially prepare for the unexpected home-related expenses that may pop up down the road. Roughly about 3 percent less than your price ceiling will help to lower your monthly mortgage slightly and allow you to create an emergency fund by saving a few dollars every month.
8. Open Houses Are Your Best Friend
Start visiting homes months before planning to make an offer in order to get a feel for the neighborhood (see above), the different types of homes, the types of gadgets (available smart technology), the amenities, and types of repairs that will need to be taken care of by you or the seller. During an open house, you should make it a point to look for issues in plain sight and remember to ask questions.
9. Save Until It Hurts
Your lender will give you general guidance on saving for your earnest money deposit and down payment. But, when it comes to closing, there can be an expense that may catch you off guard. You should anticipate closing costs of about 3 percent of your sale price. Then add another 0.5 percent for good measure – for any additional surprises. Also, the lender is watching your credit score and buying habits right up until the day your financing is delivered to escrow to pay for the home. So, if your credit score changes due to purchasing a new car a week before moving in, then you will likely have to come up with more money for your home or possibly delay closing.
10. Take Advantage Of The Home Inspection
Lastly, you will likely hire a qualified inspector to check on the home’s stability, and it is highly recommended that you attend the inspection, if possible. Even if you cannot make it to the assessment, you will still receive a report with a list of any issues and items worth looking at. This report will come in handy if you want the seller to make some of the repairs or if you wish to receive a credit on the sale price to cover making those repairs yourself. In the past, Seattle/King County was definitely a seller’s market, and thus many buyers were waiving the housing inspection, which is not advisable by any means. The fear now is that with high demand and limited supply, this might become a problem again. But you should always have an inspection and address major issues with the seller’s agent as part of the negotiation.
Home buying can appear mind-boggling at first. With a little patience, a bit of homework, and some investigation, you’ll soon be making sense of the whole process and finding yourself well on your way to your new house. If you have any questions or you’re interested in discovering what mortgage you qualify for, contact us today; our specialists will be happy to help with any of your Bellevue, Kirkland, or greater Seattle mortgage needs.
Need a Mortgage Home Loan or Have Questions?
Will you need mortgage financing to buy a home in Washington State? We can help. Sammamish Mortgage has been serving buyers across the Pacific Northwest since 1992 including, WA, OR, CO and ID. We offer a wide variety of mortgage programs and products with flexible qualification criteria. Please contact us today with any financing-related questions you have.