There’s a lot of uncertainty when it comes to buying your first home, and you’re bound to have a lot of questions. If you’ve chosen well, you have a real estate agent who will answer your questions with patience and clarity. Getting the right real estate agent who can answer with authority and experience is essential.
Once you have selected your agent, there are some key questions you need to ask.
What Are First Time Home Buyer Questions You Need to Ask Your Agent?
How Much Can I Afford?
This is the number one question that you should ask. And you’re not asking so that you can buy the very most expensive thing possible (usually). A good buyer agent will help you understand the implications of your monthly mortgage payments, what your credit score will mean, how much homeowner’s insurance is going to cost, and how to work with mortgage lenders to get the monthly payments you want.
Do I Have Enough Money For a Down Payment?
Down payments are one of the hardest things that potential homeowners need to come up with. It can take years of scraping and saving to get the money you need for a down payment to buy a home. There are different programs that will affect how much of a down payment you need, and in the buying process your agent should be upfront and clear with you about them.
What Are the Closing Costs?
Yes, when you buy a house there are “hidden fees”. There are costs that come along with buying a house that aren’t just the percentage down to purchase the home. These closing costs include home inspections, seemingly endless paperwork, agent costs and more. Knowing these costs upfront is important.
What Are the Hidden Costs of Owning a Home?
A first time home buyer might not know that there are more long term costs of buying a home than just the purchase price. There’s property taxes and utilities and possibly HOA fees. If you have a variable interest rate then that could change and be a “hidden cost”. Make sure to talk with your agent about any potential hidden costs associated with a property you are interested in.
How Long Should I Plan To Stay in the Home?
Obviously, your real estate agent isn’t going to know the details of your future plans. But be sure to have conversations with your agent to discuss whether this is a starter home you expect to be in for three to five years, or whether this is your forever home.
How Will Buying A Home Impact My Future Financial Plans?
A real estate agent isn’t a financial planner exactly, but they are very aware of what it means to use your savings to buy a house–to make an investment in real estate. And they know what that investment means in the long term. If you’re wondering if you should dip into your 401k to get that home deposit, then the real estate agent will be a perfect person to discuss that with.
How Do I Know I’m Getting an Honest Deal?
There are a lot of agents who represent home buyers AND home sellers, so there’s a direct conflict of interest. They can push someone to buy a property of one of their other clients, essentially double-dipping into the deal.
The good news is that you’re in the right place! Members of the National Association of Exclusive Buyer Agents (NAEBA) are buyer-only agents, not sellers. This means that you can rely on NAEBA member agents because they’re committed only to selling you a home, not trying to sell some other client’s house to you.