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5 Tips for First-Time Homebuyers

Buying your first home is an exciting time and a huge accomplishment. Whether you are looking to purchase a house, townhome, or condo, as a first-time homebuyer in Bordentown or Robbinsville, NJ, there are a few tips and tricks you should know.

1. Don’t Rush Into It 

A pro tip, especially for first-time homebuyers in Bordentown, NJ, is to map out your homebuying timeline at least one year before you are ready to start looking. Things you will need to take into consideration include saving enough money for a down payment, saving for closing costs and furnishings, and also repairing or addressing any discrepancies in your credit score.

2. Start Saving Early for Your Down Payment
Homebuyers who put down 20 percent or more don’t have to pay for mortgage insurance on a conventional mortgage. However, you don’t want that down payment to completely wipe out your savings account either. A good rule of thumb is to have at least three to six months of living expenses tucked away in an emergency fund.

It’s important to note that the long-held belief that you have to put 20 percent down is simply a myth. According to the National Association of Realtors, the median down payment on a home is 13 percent. The impact your down payment will make really depends on your mortgage, which is why it’s important to explore all options available to you. An experienced Bordentown, NJ, realtor can help you determine what the ideal down payment will be for you.

3. Get Help with Your Down Payment 

It is common for family members to “gift” first-time homebuyers their down payment. However, if you aren’t lucky enough to have family help, you can explore NJHMFA’s Down Payment Assistance (DPA) program.

The New Jersey Housing and Mortgage Finance Agency (NJHMFA) helps first-time New Jersey homebuyers by providing $10,000 to use either as a down payment or to help with closing costs. It is an interest-free, five-year forgivable second loan with no monthly payment. To be eligible for participation you must be a first-time homebuyer and take out a NJHMFA first mortgage loan. The first mortgage loan is a 30-year, fixed-rate government-insured loan, with NJHMFA as the participating lender. Maximum household income and purchase price limits may apply. Overall, the Down Payment Assistance program proves to be very helpful for first-time homebuyers in Bordentown and the surrounding New Jersey areas.

4. Explore Mortgage and Loan Options

With so many steps involved in the homebuying process, it can be easy to just work with the first lender or mortgage broker that you meet. Like anything else in life, it’s always good to get a second opinion. This reigns true when it comes to lenders and mortgage brokers as well. If you choose to work with a good and experienced buyer’s agent, they will be able to recommend lenders and mortgage brokers that they have worked with before. But, you should make it clear that you want more than one opinion. When you get two or three opinions, you’ll have a chance to compare rates, lender fees, and loan terms.

There are also three types of government-insured loan programs that you should explore in addition to conventional loans.

– Federal Housing Administration (FHA loans) – for borrowers that don’t have the best credit or have little money saved

– U.S. Department of Veterans Affairs (VA loans) – for eligible active-duty and veteran military services members and their spouses

– U.S. Department of Agriculture (USDA loans) – helps low-income borrowers buy homes in rural areas

Hire the Right Buyer’s Agent

Choosing the right realtor can make or break your homebuying experience. As a first-time homebuyer in Bordentown, NJ, you want to find a buyer’s agent that will not only find you the right home but also help educate you along the way. There are a lot of moving parts when it comes to buying a home, so you’ll need to work with someone who is experienced, knowledgeable, and patient.

Buying Your First Home 

Buying a home should be fun. As a team of the best realtors in Bordentown and Robbinsville, NJ, and the surrounding areas, it’s our mission to get you into the home of your dreams. Contact us today at (609) 757-9647 for more information.

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