Buying your first home is a thrilling experience—so why are you so nervous? The answer is easy: because you’re human. Buying your first home is a big purchase, most likely the biggest purchase of your life. And your thoughts may immediately go to the responsibilities of owning a home—instead of focusing on the astronomical benefits.
Benefits of Homeownership
Reviewing the benefits of homeownership (especially in Denver) can always decrease anxiety and stress, as can taking the right steps as you move through the home-buying process.
- You’ll be investing in your future wealth instead of supporting your landlord’s.
- You’ll own a piece of real estate, an asset that appreciates over time.
- You’ll eliminate the risk of rent increases or having the building sold out from underneath you.
- You’re more likely to establish stronger and longer ties with the community.
- You’ll have the creative freedom to make your space truly your own.
Preparing Finances to Purchase Your First Home
Your first step is determining how much new home you can afford. Be honest and realistic when it comes to calculating how much you can comfortably spend for a down payment and monthly mortgage payments.
Financial preparation can go a long way toward quelling any financial jitters that may come with a new home purchase. Good things to have include:
- Money saved for a down payment, or a loan option that helps with a down payment
- A steady income that continues to remain steady during uncertain times
- Access to an online mortgage calculator to confirm your price range
- Accessible savings for unexpected emergencies
- A credit score likely to be approved for a mortgage, or a loan option that doesn’t require a credit score
Explore Loan Options
Once you’re clear on what you can afford, shop around for a lender so you can get pre-approved before you even start to look at home options. Getting pre-approved for a home loan expedites the overall home-buying process. It also gives you an estimate of the loan amount you may expect.
Conventional loans from banks and other financial institutions are always an option for first-time homebuyers, but they aren’t the only ones. Because home purchases help stimulate economic growth, a number of programs are geared toward helping first-time buyers.
- CHFA Programs in Colorado: The Colorado Housing and Financing Authority (CHFA) offers a variety of loan options as well as down payment assistance. Options include FirstStep, SmartStep, Preferred, and HomeOpener. Each has different requirements, some rewarding good credit scores and others available with no credit score.
- National Programs across the U.S.: First-time homebuyers can likewise look into federal programs available to anyone. These include Fannie Mae, Freddie Mac, and Federal Housing Administration Loans (FHA).
- Conventional Loans: If you decide a conventional loan is the way to go, you still want to do your research. Different lenders have different requirements and mortgage rates, and you want to make sure you choose the one that’s best for you.
Establish Your Needs and Wants
Another way to dispel first-time homebuyer jitters is to make sure you choose a home that suits you. Divide a piece of paper into two columns. One column lists your non-negotiable home requirements – things you must have. The other column lists things you want but can be flexible about.
Entries on your lists might include:
- Neighborhood walkability and amenities
- Proximity to restaurants, cafés, shopping, and nightlife
- Parks and recreational activities
- Transportation options
- New build or existing home
Start Hunting for Your First Home
Once your prep steps are complete, it’s time for the real fun to begin. Exploring homes and imagining the possibilities are what fuel the greatest excitement. Partnering with a trusted realtor can help ensure you get the best deal, as they have market insights on average price ranges in different areas.
If you’re not sure where to start your search, consider a newly built condominium like The Nightingale which may offer incentives that make your first home more beneficial and affordable than buying an existing home.
These may include:
- Interior upgrades; fresh paint and flooring
- No need for costly structural repairs or items that need immediate replacement
- Ideal location in the hippest districts
Shopping for newly built condominiums can also eliminate stress by ensuring you get what you really desire—a home that gives you everything you need and want that you can truly make your own.
From Stress to Success: Easing First Time Homebuyer Jitters
One last step for eliminating the jitters is to familiarize yourself with the entire home-buying process so you know what to expect at each stage of the game. The entire process can take several months, so learn to breathe deep and relax and enjoy the ride.
The stages of the process include:
- Pre-approval of your loan
- Searching for and finding your new home
- Making an offer; having it accepted
- Waiting for the appraisal and inspection of new home
- Waiting for underwriting and official approval of your loan
- Closing on your new home and moving in!
Keep your eye on the prize, or that final step of closing on your new home and moving in. With the amount of preparation you’ve done, the knowledge you’ve acquired, and double-checking of finances you’ve undertaken, you may find you have no reason to be anxious or stressed about buying your first home. You’re much too busy being excited.
Contact Highland Development Company to take the first steps toward homeownership today!