Excitement & Nervousness
Buying your first home is an exciting time for sure! It can also be a little unnerving too. Below are a few simple tips to help you make the most of buying your first home. Just remember, we are the home buying professionals and we have helped thousands of other first-time home buyers just like you purchase their home. You can count on our team to walk you through every step of your real estate transaction to your complete satisfaction.
Compromise & Communication
As a couple buying your first home, it is important to remember to be ready to compromise on a home’s features. In addition, you should practice maintaining good lines of communication too. Maintaining good lines of communication with your spouse and with your Realtor is important. It creates an efficient first-time home buying process, plus it will make your home buying experience much more pleasant too!
Know the Difference Between What You Want & Want You Need
Before searching for your first area home, it is recommended you make a list of your “wants” and your “needs” in your first home. Just to clarify, your wants are what you “desire” in a home and your needs are what you absolutely “must” have in your first home.
Below are a few questions to help you prioritize your wants and needs in your first area home:
- How close do you want to live to your office or to your family?
- Do you prefer to live in the country or in town?
- Are schools important to your first home buying decision?
- Are you willing to pay homeowners dues for amenities like a golf course, tennis courts, swimming pool, walking trails, and other recreational facilities?
- Do you wish to purchase your first home near shopping?
- Are you looking for a neighborhood that contains lots of younger families with small children?
- Are you looking for a quieter neighborhood environment with less small children?
- Has the neighborhood you are interested in held its value? (Our agents can provide statistics.)
Once you're ready to begin your search for your first home, remember these helpful house hunting tips:
- Always preview homes together with your REALTOR. They will eliminate homes that fail to meet your search criteria and your finances.
- Keep track of the houses you’ve seen by bringing along a camera.
- Be sure to take notes both positives and negatives about each home.
- We recommend you wear comfortable shoes and clothes
- If you have small children, consider a babysitter. Once you've narrowed your choices, you can bring them along.
- Limit your daily search to 4 homes.
- Limit your search to homes that fit your budget
Are You Ready to Get Started?
After you have prioritized your wants and needs for your first home, now you're ready to begin your home search. Contact us, and we will schedule a first-time home buyers consultation to discuss how we will help make your first home buying dream come true.
Los Angeles First Time Home Buyer Resources
Thinking of buying your first home in the LA area? Welcome to the world of real estate! Buying a home isn’t just an exciting personal achievement, it’s also one of the smartest financial decisions you can make. But it’s also a pretty big decision (one with a very large price tag), so it’s important to arm yourself with all the tools you need to make a smart investment for your wallet—and a pleasing choice for your personal tastes and interests.
Here’s what first time home buyers in Los Angeles need to know.
Mortgages Matter: Here’s How to Find Yours
Unless you’ve got a VERY large savings account, you’ll likely be using a mortgage to buy your home, which is the case with most buyers. Contrary to popular belief, though, a home loan isn’t a one-size-fits-all deal; actually, there are over 200 different types of mortgages out there! Good news for you, because there’s probably a loan out there to fit your budget and situation. So… how to find the right one?
Step 1: Get in touch with lenders
The #1 thing we recommend to all buyers is to start talking to lenders—before you start searching for homes. Not only can lenders help you understand more about the types of loan options out there, they can help you determine if there are any potential hang ups that might prohibit you from qualifying for a loan, as well as what monthly payments might look like at various home prices and loan types.
Step 2: Get preapproved.
Once you start talking to lenders, they’ll likely want to get the ball rolling right away to get you preapproved. The good news here is that preapproval doesn’t obligate you to any one lender, but DOES give you a solid idea of how much loan you’ll qualify for. It also shows sellers you’re a serious buyer—with the ability to obtain enough loan needed to cover the price of the home. This distinguishment is a CRUCIAL step up against non-approved buyers, especially in a highly competitive market like LA’s.
Step 3: Learn more about loan options
Like we said, there are a LOT of different loan options out there. You might’ve heard about needing a 20% down payment to buy a home, but that’s rarely the case nowadays. In fact, there are many loan options for buyers with far lower down payments, like the FHA loan (as low as 3% down) or the VA loan (0% down!).
There are also some local first-time buyer loans you should know about. These are obtained through private lenders, but not offered by all lenders, so it’s good to ask about them with each lender you speak with!
CalHFA: The California Housing Finance Authority offers a variety of loan programs and down payment assistance programs designed to help new buyers and low-income buyers purchase homes in California.
LACDA: The Los Angeles County Development Authority offers several loan options, like the First Home Mortgage Program and the Home Ownership Program, targeted to low- and moderate-income buyers.
You Really Should Work with an Agent
One of the best ways to ensure you’re making a smart decision—for yourself and for your wallet—is to work with an experienced local real estate agent or team. LA is a big city, and its real estate market is pretty competitive. Here’s what a good agent should do for you.
The key to finding the right home at the right place is looking in the right spot! A good agent will be able to help you pinpoint a neighborhood that’s close to the amenities you need, that’s got the right kind of lifestyle for your lifestyle, and that fits comfortably into your budget.
Is that home a good deal or way overpriced? Just by looking at a home, you probably won’t know, but you bet your agent will! A good agent will be able to tell you whether a home is a good investment (well-priced, positioned to grow in value) or a bad idea (overpriced, not in-demand).
Advice & assistance
What’s a good price to offer on that home you love? What contingencies should you include? What does a home inspection entail? What do you need to know for the close? These are all questions a real estate agent can answer for you—while they walk you through the process from start to finish.
Location, Location, Location! Find the Right One for You
In real estate, location is kind of a big deal—for you and for your wallet. For you, the right location can ensure you don’t spend more time than you’d like gridlocked in LA’s somewhat notorious traffic. And for your wallet, well, a good neighborhood is likely going to mean a higher payout when you finally sell your home. So, here’s how to find the right spot.
Think about what you need
How far do you want to be from work? The grocery store? Great hiking? Horseback riding? Think about the places you visit most frequently, as well as how you’d like to get there—car, foot, bike, bus, etc.
Do your research
Now that you know where you’re going and how you’re getting there, you’ll probably want to do a little research into LA’s various areas and neighborhoods to see which might be best suited for you. Keep in mind, some might have better access to public transportation, while others might be located on bike paths or within walking distance to shopping and dining.
Ask your agent
When in doubt, ask your trusty agent! He or she will know better than anyone where to find a spot that’s got everything you need. Because real estate agents spend most of the day getting to know various neighborhoods—the good and the bad—you might say we know the city like no other.
Here We Go: The Home of Your Dreams!
All right, you’ve done all the prep work and now it’s time to actually start searching for the home of your dreams. But before you start rushing out to ogle gourmet kitchens, it’s important to take some time to really sort out your needs from your wants from your would-be-nice-es.
Then, once you’ve got that sorted out, you can try some online searches based on your budget, needs, and maybe some wants, too!
These are the absolute bottom-of-the-line dealbreakers. Think big-ticket, hard-to-change items, like size, number of bedrooms, location, and price. If a home is missing one of your NEEDS, it’s not the home for you—so don’t burn yourself out by scheduling a showing.
These are the things that are important… but maybe not essential, like that luxurious master bedroom suite. They may also be things that are easier to add or update—like solid-surface counters, new appliances, or energy-efficient features.
These are those “dream home” features nobody really needs and definitely aren’t essential… but are an added bonus, or maybe even a tie-breaker, if you’re torn between two homes.
Making an Offer
All right, you found the PERFECT home and you’re ready to make an offer! Before you rush into things, it’s essential that you sit down with your agent to discuss the maybe less-interesting details, like what similar homes are selling for (which will help you determine if the home is priced correctly), what contingencies you’d like to include, and what your closing dates should look like. You agent will then write up a Purchase and Sale Agreement—and the process of making an offer begins!
The Purchase and Sale Agreement
This legal contract has all the details of the sale as you’re offering them—price, contingencies, closing dates, and even what type of loan or other financing you plan to use.
Once the seller receives your P&S Agreement, they have three options. A. They can accept your offer exactly as it is. B. They can flat-out refuse your offer. C. They can offer a counter-offer with adjusted price or terms. At this point, the ball is back in your court and you have the same three options.
Accepting the offer
Once you and the seller reach terms you can both agree on, you’ll sign a new Purchase and Sale Agreement… and the next step of the process is underway!
Due Diligence—And All the Paperwork
Once you’ve got a signed P&S Agreement, the next step is to get a home inspection. Typically, this is scheduled within a few days after the agreement is signed, so be ready to get the ball rolling! Your lender will also likely start asking you for a lot of financial and personal documentation—bank statements, tax returns, proof of employment, and more—so be ready to scan or send in a lot of paperwork. Your lender may also schedule an appraiser to go out and evaluate the property, too.
Handling the home inspection
A professional home inspector will analyze the home you plan to buy with a fine-toothed comb to root out any potential issues or areas of concern. Should he or she find any, you may ask the seller for a price reduction, for credits towards your closing costs, or for repairs to be made. Should the seller refuse, you typically have the option to walk away from the sale.
Navigating the appraisal
The appraisal is usually handled by your lender or bank. This step ensures that the home you plan to buy is worth at least the value of the mortgage. In other words, a bank doesn’t want to loan you $200,000 to buy a home that’s only worth $150,000 because if you default, the bank is now out $50,000! An appraiser will inspect the home and analyze the market to determine a fair value.
Finally: Closing Day!
At long last… it’s closing day. The good news is that most of the work is already done for you. Typically, the closing happens at an attorney’s office in the presence of both the buyer’s and seller’s attorneys, as well as both real estate agents and the home buyer. The seller is sometimes present and sometimes not. At this time, you’ll sign a (rather hefty) stack of documents, pay your down payment and closing costs, and get the keys to your new home.
Ready to Buy Your First Home in Los Angeles?
Are you thinking of buying a home or relocating to the LA area? Brad Korb Real Estate Group is here to help! Give us a call or start searching our buyer resources today to learn more about how we can help make your homebuying dreams come true!
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