Buying Your First Home In Dallas-Fort Worth
It’s hard to describe the feelings one experiences while buying their first home. It’s a combination of excitement and nervousness. Fortunately, it’s easy to work through these emotions and make a smart home buying decision when you follow the advice I’ve outlined below!
Financing is Your First Step
When you first decide to buy a home in Dallas-Fort Worth, it’s tempting to go online and start skimming through pages of houses. However, the first thing you should skim through is your financial records.
You’ll want your finances to be well-prepared for the costs of buying a home. Start by paying down existing, high-interest debts, boosting your credit score, and saving your money for a down payment of at least 20 percent of the home’s value. For down payments of less than 20 percent, you may have to take on private mortgage insurance (PMI) from your lender.
With your finances in order, you can start the pre-approval and pre-qualification process. Many first-time homebuyers confuse these two or assume they mean the same thing when in reality they are quite distinct from each other.
- Pre-approval is how much of a loan the bank will guarantee for your new home.
- Pre-qualification lets you know how much you can afford for a new home in the Dallas-Fort Worth area.
Being pre-qualified for a home loan is a great first step, but real estate agents and home sellers won’t take your offers seriously until you’re pre-approved. Getting pre-approved for a loan also gives you an idea of what you’ll be able to afford, allowing you to narrow your focus down to just the homes in your price range. That said, make sure your home buying budget also includes additional costs like inspections, repairs, and closing costs.
What Are You Looking For In A New Home?
Here’s the part that everyone loves. With your finances and pre-approval in hand, you can start looking for your new dream home in Dallas-Fort Worth. You can make the search easier by thinking about what your needs and wants for your home look like. Consider factors like:
- How many bedrooms do you need?
- How many bathrooms do you need?
- What’s your ideal amount of square footage?
- What amenities do you want nearby? Like schools, stores, etc.
These factors should be seen as “non-negotiable,” as in your prospective house has to have these features to even be considered. Next, you can start to think about the features you would like your new home to have. Keep these other factors in mind:
- Does the home have a multi-car garage?
- Are there solar panels or energy efficient devices?
- Is there a pool or community pool nearby?
Enlist A DFW Real-Estate Expert
Now that you know what you can afford and what you’re looking for, it’s time to call in the experts. Discussing your requirements with me will provide me with the information I need to start helping you reach your goals.
Starting the Home Buying Process
After working with a real estate agent to find your ideal home, it’s time to put in a bid. This is one of the most difficult and nerve-racking parts of the home buying experience, but as your real estate agent, I’m here to help. I’ll help you run a comparative market analysis (CMA) that will allow you to determine the right price to offer on the home. Don’t be surprised if your offer is not accepted right away. Many factors, such as contingencies and a high asking price will contribute to their decision. This is where you’ll be glad you have me in your corner. My experience allows me to negotiate persuasively while protecting your interests.
Negotiating With Other Sellers
First-time buyers commonly run into problems during this phase of the home buying process. But it’s in this phase, more so than others, where it’s important to take your time and be thorough. Given the enormous financial costs of buying a home, you don’t want to make a mistake that will cost you later. But once again, your agent will help you make the right choices. You can make the negotiation easier by doing some of these things while avoiding others:
What To Do When Negotiating
You’ll want to prepare yourself to deal with several rounds of offers and counter-offers with the seller. They’re trying to get as much money as possible, while your goal is to drive the price down. Having leverage will be crucial for a successful negotiation.
You can gain that leverage by being an informed buyer. Work with your agent to perform some market research in the neighborhood and area that your potential new home is in. One of the easiest things to find is the number of days the house has been on the market. A seller with a home that has sat on the market for months may be more willing to sell for a lower price with a little convincing. There are many reasons why a home might sit and wait on the market. Here are some of them:
- The house is vastly overpriced
- Nearby new home construction is drawing more attention and causing increased traffic and pollution in the area
- Home values are falling in the surrounding area
Asking the right questions about why a house has stayed on the market can help you to understand the seller’s position. Use these questions to help gain leverage:
- Why has the seller decided to move?
- What are the drawbacks of the neighborhood?
- Are there a lot of other homeowners moving out of the area?
- Is the area susceptible to damage from weather? For example, does the basement flood when it rains? Are there frequent hailstorms? Is there a risk of fire if the house is in a heavily wooded area?.
The more information you have about the home and the seller, the more leverage you have during your negotiations on the price.
What To Avoid When Negotiating
Of course, the seller is trying to find out about you so they have their own leverage during the negotiating. The trick to closing on a house is to perfect your poker face. You don’t want to let the seller to know how much you want to buy the house. Even if you feel like there’s never been a better option for you than the one you’re trying to buy, you’ll want to appear aloof and professional. That way, the seller won’t try and manipulate the price to match your excitement to buy the home.
Additionally, it’s best to avoid these other mistakes when negotiating on a home:
- Don’t let the seller rush your decision making process
- Try not to show how excited or anxious you are to buy the home
- Keep your financial status and records to yourself
- Avoid telling the seller or their agent your maximum price for the house and your down payment amount
You can mitigate the seller’s leverage over you by working closely with your Dallas-Fort Worth real estate agent and taking your time. Don’t allow yourself to be rushed into closing the deal. Make sure a thorough inspection is performed on the house, and don’t commit until you’re aware of all the issues.
Your Mortgage Options for Homes in DFW
For most, paying for a home out-of-pocket simply isn’t feasible, so you’ll likely need some financial assistance. A mortgage is one way to get the house you need. Of course, there are several types of mortgages available to you. Fortunately, I can help you find a mortgage lender that meets your needs.
Fixed Rate Loans
This is a standard loan for those who are looking to stay in their new home for the long-term. This monthly payments of this type of mortgage do not change with time. However, the interest rate and payment rate also never goes down. The interest rate at the time the loan is agreed to is the rate that you will have to deal with during the course of the loan. If interest rates are low, a fixed rate loan is an ideal financial solution for buying a home.
Adjustable Rate Mortgages
The opposite of fixed rate mortgages, the rates on this type of mortgage can change. Often, the introductory rate for an ARM is lower than fixed-rate mortgages. But with time, these rates will change to match interest rates. While you might get a low rate initially, your rate could climb with time. Each lender will have their own formula to determine just how much interest they charge you, so it’s important to understand that formula. An adjustable rate mortgage is great for those who aren’t planning to spend years and years in their home.
For those that qualify, a government loan is an affordable way to own a home. They include FHA loans for low-income families, as well as VA loans for military service members and their spouses.
Work With Me Today
Ready to buy a new home in the Dallas-Fort Worth area? Then it’s time to give me a call. I know all of the nuances and intricacies of the DFW housing market and will put my skills to use to help you find your new home. Contact me today to set up an appointment so I can get you into your dream home!