Dear aspiring homeowner,
We know that taking the step to buying your first home can seem overwhelming, and there are often many questions. We would like to help you prepare and hopefully, we'll help you find a home you love.
How it Works
Get your finances in order
- Pay down your debt. To increase your borrowing power, pay down your debt as much as possible. Start with the highest-interest debt first (credit cards) before lower interest debt (car loans, student loans).
- Set a budget. The standard rule is to aim for a home that costs no more than 2.5 times your gross annual salary
- Get the down payment together. If you don't already have down payment money saved, start saving now. Having a down payment is crucial for being able to qualify for a loan, especially being able to qualify for a bigger loan.
- Clean up your credit report. Good credit not only helps you qualify for a loan in the first place, but it also helps you get a better deal when you do get a loan.
Contact a local lender to get pre-approved
The pre-approval process will determine two things. First, the lender will determine if you're even qualified for a home loan. You must meet their minimum criteria for credit score, debt ratios, income, etc. If you meet these requirements, the lender will give you a maximum loan amount. They may also give you a pre-approval letter to use during the house-hunting process.
Here's a more complete list of benefits:
- Getting pre-approved for a mortgage helps you identify any problems you have (too much debt, a low credit score, etc.). The sooner you can find about these issues, the better. It gives you more time to correct them.
- Real estate agents will be more willing to work with you. Most agents will only work with buyers who have been pre-approved.
- Sellers will take you seriously. This is especially important in an active market, where multiple offers are a reality.
- It also helps you narrow the field when house hunting. Once you know how much the lender is willing to offer, you can shop within that price range. This is a sensible approach to house hunting.
Find a realtor that fits you
Finding the right agent takes balancing credentials and chemistry. Not all real estate agents are Realtors. The term Realtor is a registered trademark of the National Association of Realtors (NAR). You want a licensed and trustworthy agent who you can rely on. NAR members pledge to abide by the association’s code of ethics. A good agent will listen carefully to your priorities and won’t waste time on properties that don’t fit the bill. Experience is important, but sometimes less experience means a smaller client base, which translates into more attention for you. Real estate is a local game, and to win you need someone who plays in the areas where you’re looking to buy. Not only will they be up on market trends, but they’ll also know about local schools, commute times, and under-the-radar red flags.
Determine your needs and wants
Carefully considering your wants and needs is a key early step. You’re not likely to get everything you want in a home, unless you’re building it from the ground up (with the budget to match). Your home search could be a frustrating experience unless you separate the things you truly need from the amenities and features you’d love to have but can live without.
Consider “needs” to be true essentials that aren’t easy (or possible) to change. These are genuine must-haves that leave little room for compromise. Your “wants” are the kind of non-essential things ready-made for a wish list. One approach is to compile a list that can help you set initial priorities.
For first-time buyers, it can be tough to get started. Consider what you like and what you don’t like about your current living situation. Think about the features and amenities you like in other people’s homes. Think about your plans, your goals and your life trajectory in the coming years and how that might affect both your wants and needs.
Tour many homes to see what's availableLook at lots of houses! When home-shopping, take your time with your decision and find a house that you really love, one that gets you excited when you imagine living there and think of the possibilities. You're unlikely to find a home you love right away, so unless you find your dream home sooner, give yourself at least a few months to find it. The extra time dramatically increases your chances of success. Take a camera to every house you visit and take lots of pictures of each property. After each visit write down everything you like and dislike about the house, and the neighborhood, in as much detail as you can. Don't discount a home because you don't like superficial things like the paint color or flooring. Once the home is yours, you can do anything you want to it. Consider the home's potential, not its present state. Check out the neighborhood (schools, demographics, crime, etc.) and check out how walkable the area is. Once you've found the home you want, visit the neighborhood several times, day and night, weekday and weekend. Much of your comfort is going to come from the neighborhood itself and not just the house, so make sure you like the area as well as the property.
Make an Offer
If there's a good chance you want to buy the house, then you'll make an offer to the seller. You can make the offer even if you're not 100% sure you want to buy the house, and even if you're not sure exactly how much you want to pay.
Things to consider:
- Price - Finding the balance between being house poor and living a comfortable lifestyle
- Closing costs – Will you be splitting closing costs with the seller
- Closing date – Do you need to sell your home to purchase this one? Is there a specific date you need to close by?
When you’re ready, deliver the offer to the seller or to the seller’s real estate agent. The seller might reject your offer and give a counteroffer of a price a little higher than yours. You can agree to that or counteroffer again, offering slightly less. The process continues until you've either both agreed or neither side will budge, in which case the deal has fallen through.
When your offer has just been accepted — congratulations! — you are fired up and ready to move into your new home. But don't neglect the steps that protect both the buyer and the seller. After an offer is accepted, prepare for a home inspection and appraisal before reaching the closing table.
Your real estate agent's help and guidance really pay off for you after the purchase offer is accepted. You might think that you need your agent solely to help with the initial negotiations, but there are often challenges that can crop up all the way to closing that require finesse. You might not even notice what your agent is doing behind the scenes or how your agent is helping you if your agent doesn't point it out. The good news is competent agents deal with these issues every single day. You should be able to rely on your agent to help you get through the things that can go wrong after your purchase offer is accepted. Then, when it closes, you truly have reason to celebrate.
We had an excellent time and an awesome experience through the whole home buying process. Andrew Gudmunson was understanding of our needs and he responded quickly to every question and concern that we had. I wouldn’t hesitate a single second to recommend him to anyone that needed a home. As long as Andrew is a realtor… Read more “Great Experience!”
When starting the process of searching for our new home, we found ourselves in a unique situation. We lived 6 hours away from the Minot area. With two busy jobs and a child on the way, we had few opportunities to go look at houses. Andrew Gudmunson was extremely accommodating to our needs. He alerted us… Read more “Outstanding Service.”
Understanding and Caring.
Andrew ‘Goody’ Gudmunson’s relentless pursuit of a place for us to call home was second to none. Andrew put us first from the first time we called him about being interested in looking until we closed. Because of his very approachable demeanor, we were comforted as we embarked on a journey we were new to. Andrew… Read more “Understanding and Caring.”
Thank you Goodie!
Being a first time home buyer, I didn’t know a whole lot about the buying process. Andrew Gudmunson did a great job in explaining everything to me in words I could understand. I had a job out of town where I would leave town early in the morning and not be back in town until after regular… Read more “Thank you Goodie!”
Professional and Personalized Service
Andrew gave me professional, personalized knowledge and advice throughout the entire process of buying my first home. He was patient with my never-ending questions and he always addressed my concerns quickly and happily. Above all, Andrew made the process fun and exciting, yet simple and easy to understand. He is one of the nicest people to… Read more “Professional and Personalized Service”
Andrew did a great job finding a house within our budget and making it feel like it was worth so much more. Because he was always available to answer any questions we had, he made the whole process very easy. My wife pays a lot of attention to detail and Andrew was able to help her… Read more “Good Job.”
Hardworking and Caring
Andrew Gudmuson has worked with multiple members of my family. His integrity, loyalty and hard work have always impressed us. This was our first home purchase and Andrew did a wonderful job calming my nerves and reassuring me. And he was right! We had multiple counter-offers and negotiations. Because Andrew remained calm and in our corner,… Read more “Hardworking and Caring”
Satisfied Home Owner
Andrew Gudmunson went above and beyond in helping us find and decide on a cabin at Rice Lake. He made sure to connect us to the right people at the right time. This made the buying process go smoothly. We gave him a firm price and he got it for us! I was very impressed with Andrew… Read more “Satisfied Home Owner”
Experienced, Knowledgeable and Result-Oriented.
From start to finish, Andrew demonstrated applicable knowledge and experience with the sale of my home. His local connections and professionalism were abundantly clear throughout the entire process. Because Andrew has a history of success as a Century 21 Agent/Owner, it made the decision to choose him as our real estate agent that much easier. Being… Read more “Experienced, Knowledgeable and Result-Oriented.”