Buying your first home is stressful and confusing. There is so much to learn during the process that it can feel very overwhelming. It’s also one of the most important financial decisions you will make in your life. So, it’s natural to worry that you aren’t doing it right or that you will miss something. With all this extra stress and anxiety, it’s easy to forget to ask yourself some critical questions during the process. So, we’ve worked up a list of the five questions you need to make sure to ask during the buying process.
- Is this the right location? You can change almost anything about a house, except where it sits. Location is a huge factor when you are buying a home. It determines how you travel, who your future friends and neighbors might be, where your kids will go to school, and how often you see your extended family.
- Is this the right type of loan? Unfortunately, there is no one size fits all home loan! Everyone’s financial needs and future plans are different, so you’ll want to ask about various loan options. Don’t stick with a cookie-cutter 30-year home loan because it’s what your parents did. Instead, speak to a mortgage specialist who will help you find the right loan for your financial needs.
- Is this the right time to buy? Timing the real estate market is a tricky thing. Right now, housing prices are up across most of the country, mortgages rates are low, and inflation is rising. That’s a lot of variables to consider. Our advice is to think long-term and consider how this financial decision will play out 5, 10, or 20 years into the future.
- Is this a good mortgage rate? Mortgage rates can be confusing. When you sit down with a loan specialist, they will walk you through the whole process, so you understand why you were quoted a specific rate. Don’t be afraid to ask questions or take a step back if you feel the rate isn’t right for you. Sometimes waiting to buy until your credit score and finances are in a better place so you can get a more favorable mortgage rate is a wise decision.
- Is this how much closing costs really cost? The one part of the buying process that usually surprises first-time homebuyers is how much you will actually pay to close your sale. We typically recommend that you plan for your closing costs to be at least 2-6% of your purchase price. That’s a lot of money when you’ve just put a down payment on your home. Closing costs typically include lawyer fees, mortgage application fees, property insurance fees, the cost of home inspections, and various other fees and expenditures. Make sure that you plan for these additional expenses when preparing to buy.
Of course, each person’s homebuying journey is unique. But it doesn’t hurt to be prepared and ask these questions ahead of time (and any other questions you might have). The better you plan, the more prepared and at ease you will feel throughout the home buying process.
