What to Know Before Buying Your First Home

Buying your first home is exciting, but it can also feel overwhelming. From figuring out your budget to getting preapproved, finding the right property, making an offer, and getting to closing, there are a lot of steps involved.

The good news is that you do not have to know everything before you get started. Understanding the basics can help you feel more prepared and make better decisions throughout the process.

Here are some of the most important things to know before buying your first home.

Know How Much You Can Afford

One of the first steps is figuring out what monthly payment fits comfortably within your budget.

Your home payment can include more than just the mortgage. You may also need to account for:

• Property taxes
• Homeowners insurance
• HOA fees
• Mortgage insurance
• Utilities
• Home maintenance and repairs

A lender can help you determine how much you may qualify to borrow, but the amount you qualify for is not necessarily the amount you should spend.

It is important to leave room in your budget for everyday expenses, savings, unexpected repairs, and other financial goals.

Get Preapproved Before You Start Shopping

A mortgage preapproval gives you a better idea of your purchasing power before you begin looking at homes.

During the preapproval process, your lender will typically review information such as your income, assets, debts, and credit history. You will then have a better understanding of your potential loan amount and estimated payment.

A preapproval can also make your offer stronger when you find a home you want to purchase.

Understand Your Down Payment

You do not necessarily need 20% down to buy a home.

Depending on the loan program and your circumstances, there may be options that allow for a smaller down payment. Some buyers may also qualify for assistance programs.

Before assuming you need a specific amount saved, talk with a lender about the loan options available to you.

Remember that your cash needed to purchase a home may include more than the down payment.

Budget for Closing Costs

Closing costs are another expense first time buyers need to plan for.

Depending on the transaction, closing costs can include items such as:

• Loan fees
• Appraisal
• Title and escrow fees
• Prepaid taxes
• Prepaid insurance
• Recording fees
• Other transaction related expenses

Your lender and real estate agent can help you understand the estimated costs associated with your purchase.

In some situations, a buyer may also be able to negotiate for the seller to contribute toward certain closing costs.

Do Not Skip the Home Inspection

A home inspection can help you better understand the condition of the property before moving forward with the purchase.

An inspection may identify issues involving the roof, HVAC system, plumbing, electrical system, foundation, appliances, or other parts of the home.

A home inspection is not a guarantee that a property will have no future problems. However, it can give you valuable information and help you make a more informed decision.

This can be especially important when purchasing an older home.

Think Beyond the House

When you find a home you love, it is easy to focus on the house itself and overlook the surrounding area.

Before making an offer, consider things such as:

• Commute times
• Schools
• Nearby shopping and restaurants
• Parks and recreation
• Traffic and noise
• Future development
• Neighborhood amenities
• HOA rules and fees

For buyers moving to the Reno area, it can also be helpful to compare different communities such as Reno, Sparks, Spanish Springs, South Reno, and surrounding areas. Each area can offer a different combination of housing, amenities, commute times, and lifestyle.

Consider Your Future Plans

Buying a home is a major financial decision, so think about how long you expect to live there.

If you are planning to stay for several years, you may want to prioritize features that will work for your future needs rather than focusing only on what you need today.

Think about questions such as:

• Will you need more bedrooms in the future?
• Do you want a larger yard?
• Will you be working from home?
• Do you want to be close to certain amenities?
• Could your commute change?
• Would you prefer a single story or two story home?

You do not need to predict the future, but thinking ahead can help you choose a home that continues to work for you.

Understand the Offer Process

Once you find a home you want to purchase, your agent can help you prepare an offer.

The offer is about more than just the purchase price. Other terms can include:

• Financing terms
• Earnest money deposit
• Closing date
• Inspection provisions
• Seller credits
• Contingencies
• Items included with the sale

Your real estate agent can explain the terms and help you understand how different parts of the offer may affect your purchase.

Be Prepared for Competition

Some homes may receive multiple offers while others may sit on the market longer.

If you find a home you really want, being financially prepared and knowing your budget ahead of time can make the process easier.

At the same time, do not let competition push you into spending more than you are comfortable with.

There will always be another home. The goal is to find a property that makes sense for your finances and your needs.

Remember That Homeownership Comes With Maintenance

One of the biggest differences between renting and owning is that you are responsible for maintaining the property.

Things eventually need to be repaired or replaced. That could mean a water heater, HVAC system, roof, appliances, plumbing, or other components of the home.

Setting aside money for future maintenance can help prevent an unexpected repair from becoming a major financial burden.

Work With the Right Professionals

Buying your first home usually involves several professionals, including a real estate agent, lender, title or escrow company, home inspector, and sometimes other specialists.

Having people who can explain the process and answer your questions can make the experience much easier to navigate.

Do not be afraid to ask questions. There is no such thing as a question you should feel embarrassed to ask when making one of the biggest purchases of your life.

Final Thoughts

Buying your first home is a major milestone, and the process can seem complicated when you are seeing all of the steps for the first time.

Start by understanding your budget, getting preapproved, planning for your upfront costs, researching neighborhoods, and learning how the offer and inspection process work.

Most importantly, take your time and make sure you understand the decisions you are making along the way.

Whether you are buying your first home in Reno, Sparks, or somewhere else, being prepared before you start shopping can help make the process feel much more manageable.