Even though you may have owned a home in the past, you may still qualify as a first-time homebuyer and reap some of the benefits.
Qualifications of First-Time Buyers
According to the U.S. Department of Housing and Urban Development (HUD), a first-time homebuyer is someone who meets any of the following conditions:
An individual who has not owned a principal residence for three years. If you’ve owned a home but your spouse has not, then you can purchase a place together as first-time homebuyers.
A single parent who has only owned a home with a former spouse while married.
A displaced homemaker who has only owned a home with a spouse.
An individual who has only owned a principal residence not permanently affixed to a permanent foundation in accordance with applicable regulations.
An individual who has only owned a property that was not in compliance with state, local, or model building codes—and that cannot be brought into compliance for less than the cost of constructing a permanent structure
If you qualify, here is a 7-step process for first-time homebuyers to become successful homeowners:
Educate Yourself: Begin by researching the homebuying process. Understand the terminology, learn about mortgage options, and familiarize yourself with the local real estate market. This knowledge will empower you to make informed decisions throughout the process. OnTrack provides first-time buyers education, as well as the Western North Carolina First-Time & Low-Income Homebuyer Resource Guide.
Assess Your Financial Situation: Evaluate your financial standing and determine how much you can afford to spend on a home. Consider factors such as your income, savings, monthly expenses, and credit score. This will help you set a realistic budget and identify suitable mortgage options. Understand, that even if you qualify for zero down, you may still have to come up with money to pay for the appraisal and inspections.
Get Pre-Approved for a Mortgage: Before you start house hunting, obtain a mortgage pre-approval from a reputable lender. This step will give you a clear understanding of the loan amount you qualify for, which will guide your search for a suitable property within your budget. Check this Guide to First-Time Homebuyer Loan Programs.
Hire a Real Estate Agent: Engage the services of a qualified real estate buyer's agent who specializes in first-time homebuyers. An experienced buyer's agent will provide valuable guidance, help you navigate the housing market, and negotiate on your behalf. And, the best part is that the agent is typically paid by the seller, not you!
Start House Hunting: With the assistance of your real estate agent, begin the exciting process of searching for your dream home. Consider your needs and preferences in terms of location, size, amenities, and proximity to essential services. Visit potential properties, attend open houses, and compare options before making a decision.
Make an Offer and Conduct Inspections: Once you've found a home that meets your requirements, work with your agent to make a competitive offer. If the seller accepts, schedule a professional home inspection to uncover any potential issues that may impact the purchase decision. Be prepared to offer a due diligence fee. This is a non-refundable fee provided to the seller for the privileged of taking their house off the market so that you may inspect it and decide if you want to purchase it.
Close the Deal: If the inspection results are satisfactory, proceed to finalize the purchase. Work closely with your lender, attorney, and real estate agent to complete the necessary paperwork, secure financing, and fulfill all legal requirements. Finally, sign all the closing documents, either in person at the closing attorney's office, or electronically. Once you wire the funds required to close the deal, the deed gets recorded in your name and you receive the keys to your new home!
Buying a home can be extremely stressful. Once you find the home you want to purchase, the clock starts ticking. You will have a deadline to get your inspections done, secure financing and close the deal. Your buyer's agent is with you every step of the way to make the journey to home ownership as smooth as possible.
Contact us, we're here for you.