What Should First Time Home Buyers Consider?

Of course, those buying for the first time are quite nervous about it. During the 1980s, interest rates were very high, and this was very true. When there was a real estate boom in 2005, this was true. As of today, this is still the truth.

First time buyers are concerned about how much it will cost to buy, the complexity of the process, and the responsibilities of home ownership. Generally speaking, the decision to purchase a home is the biggest financial decision a person will make. At first, you must pay the down payment, as well as the closing costs. From then on, you must pay a monthly mortgage. You must also take care of repairs and maintenance on an ongoing basis.

In the market today, new worries surface regularly. Today, our economy totters on the precipice of yet another recession. The majority of lenders require a twenty percent down payment, so very few buyers are able to qualify. Additionally, the unemployment rate continues to stand above nine percent.

In the market today, what is the most essential knowledge for first-time buyers. Think about these things first:

Today, interest rates stand between 4%-5% for a 30 year mortgage. This is a very low fixed rate. That's truly amazing! Think about what a difference there is between 4% interest and 13% interest. If the home costs a hundred-thousand dollars and you are able to make a down payment of twenty percent, you will be paying between five hundred and six hundred dollars a month. At thirteen percent, you will find exactly the same home financed with a payment of a little over a thousand dollars a month.

After the burst of the bubble, home prices plummeted and created the most affordable rates in a generation. This signals that there are plenty of bargains to find. You can save even more by looking into the many short sale and foreclosure properties on the market today.

Because of this, you can expect the great values to continue due to lower interest rates. Regardless of low prices, upfront cash is still required. Today, it is expected that this will equal, at a minimum, twenty percent of the value of your home.

However, it's not all good. The value of homes continues to plummet. If you want to buy a home, you must first do some research on market trends in your immediate area. Is home value falling quickly? Are they maintaining balance? More times than not, the housing market is linked to the job market. Are there jobs available in your city or town?

Aside from making a good financial investment, there are many viable reasons to purchase a home. No matter what the price fluctuations may be, this is a good time to buy a home if you plan to stay in the home for a long time. A home is a good long term investment because the social benefits of home ownership are dependable.

To determine whether or not home ownership is the right choice for you, it is necessary to consider all of the actual costs. You don't want to get into an unworkable financial situation now. Do you have steady employment? In addition to the amount you plan to put down, do you also have some money set aside for emergencies?

If you are looking for a home, it's a good idea to get a real estate professional to help you. If you have questions regarding the process, they can help you. You don't have to enter the process uninformed. Allow them to be your guides.

Despite the negative media coverage, you can make the decision to buy a house. In the market today, you can get some really good deals.