How to Buy Your First HomeBuying your first home can be overwhelming to think about.  Where do you start?  What should you look for?  How do finances work?

Following these steps will help you devise a plan to make your process go more smoothly, and allow you to focus on the end product - owning your own home.

First, find a real estate professional

We recommend that everyone, not just first home buyers, begin their process by finding a real estate professional.  The home buying process is extensive and requires knowledge that can only come with experience - going it alone can not only be overwhelming, it can also lose you money on your transaction.  

A real estate agent will act as your liaison during this process, offering you their extensive knowledge about the real estate market, keeping track of the paperwork for you (of which there is quite a lot), and will help negotiate the sale to your needs.

They will also be able to give you invaluable information about school districts, neighborhoods, traffic, homeowners associations, short sales/foreclosures, and other aspects that you may not already know about.

Another perk is that the buyer's agent is almost always compensated by the listing agent, as it comes out of the proceeds of the transaction.  Some home buyers are under the impression that they can save money by not hiring an agent.  Without representation, the truth is typically quite the opposite. 

Get a mortgage pre-approval

It comes across the mind of renters every year or so, once their lease is up yet again.  

"Should I keep on renting, or should I consider buying a home?"

Buying a home is an investment, to be certain, but according to recent studies, the vast majority of Americans agree that property investment is the best investment an individual can make.  

In a recent KCM blog which rebuffs the Wall Street Journal's article stating otherwise, it is clear that buying is still cheaper than renting.

The Facts and Figures on Renting vs. Buying

Zillow analyzed the 35 largest largest metro areas in the first quarter, and in every area, it would be cheaper to buy than rent if you plan to live in the home for at least 4.2 years.  In fact, in Chicago it would take the average homeowner only 2.3 years of living in a home in order for your prices to remain cheaper.

"Rents keep rising, and mortgage interest rates remain very low, which is helping to skew the rent vs. buy decision toward buying for those who can afford it. Many renters may ask themselves why renew a lease, when you can break even on the same home in less time in many areas," said Zillow Chief Economist Dr. Stan Humphries.

Trulia concurs with these findings, adding:

“Homeownership remains cheaper than renting nationally and in all of the 100 largest metro areas. Rising mortgage rates and home prices have narrowed the gap over the past year, though rates have recently dropped and price gains are slowing. Now, at a 30-year fixed rate of 4.5%, buying is 38% cheaper than renting nationally.” 

But don't homeowners have added living expenses?

The kitchen can be the heart of the home.  Here's how to design your kitchen to be an inviting, functional, and appealing space, according to Ty Pennington.

Knock it down and open it up

Sometimes less is more, but not when it comes to space.  Too many cabinets or big, bulky appliances can make a kitchen feel very cramped indeed.  When undergoing a remodel, consider a redesign of where your cabinets are placed, or adding an open doorway from the kitchen to the dining room - or knocking down that wall altogether!

Pick your focal point

Mortgage credit availability is the greatest that it has been in three years, according to Market Watch.  The standards are likely to continue to loosen in 2014 from stringent post-crisis criteria while banks are continuing to adjust to new rules and increase home-loan revenue.

A gauge from the Mortgage Banker's Association tracked an increase of mortgage credit availability to 114 in March - up from 113.5 in the prior month.  This is the highest reading in a the series's three-year history.  March of 2012 was, in comparison, at 100.

March's credit gauge is, nonetheless, far below the MBA's estimate in 2007 for a level of 800.

Is availability equal for all buyers?

Real Group Real Estate

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