Buying a home for the first time can be complex.   To avoid mistakes and make a smart purchase, do the homework and know what to expect.  To help start the process, HGTV’s FrontDoor.com identifies the top 10 important points every first-time buyer must know.

#1: Just because it’s a buyer’s market doesn’t mean you should buy right now. Don’t let the lucrative market dictate a buying decision if the time isn’t absolutely right. Potential home-buyers need to ask themselves if they have a good credit score, if their job is secure and if they can stay in the home for a few years. If the answer to these questions is “no,” it might make more sense to wait until life and finances are more stable.

#2: The cost of owning a home is more than just the purchase price. On top of a mortgage payment, there are several monthly fees and expenses any first-time buyer should consider when becoming a homeowner: insurance, property taxes, utilities and maintenance. Think about scaling back the home price in order to better budget for the entire package.

#3: Programs are out there to help first-time buyers. A sizable down payment is great to have for a home purchase, but not everyone can afford to fork over 20 percent upfront. Fortunately, there are many federal, state and local programs geared toward helping first-time home-buyers with down payments, interest rates and loan terms sure to make the whole process and affordability a bit easier.

#4: Foreclosures and short sales present great deals, but proceed with caution.  Buying a foreclosed or short sale home can be a risky proposition for a first-time buyer.  Foreclosures are often sold “as-is,” while a short sale transaction can be lengthier and more complicated than a typical home purchase.  First-timers should consult an agent or attorney with specialization in these areas.

#5: Getting pre-approved for a loan gives you more buying power.  Obtaining lender pre-approvals are important because it establishes a home-buyer’s maximum purchase price, shows sellers that the buyer is serious about buying a home and lets the home-buyer compare interest rates and terms to find the best deal.

#6: Good school districts boost property value.  One of the most important aspects of a home’s value is the neighborhood where it’s located.  Even if the home-buyer does not have kids, buying a home near sought-after schools can help the resale value.

#7: You may be able to access your tax credit upfront.  Buyers using FHA-insured mortgages can apply their tax credit toward their home purchase immediately, rather than waiting until they file their income taxes to receive a refund.  Prospective buyers who believe they qualify for the credit are also allowed to reduce their income tax withholding, therefore increasing their take-home pay.

#8: Not all real estate agents represent buyers.  There are three types of agents: listing agents, who represent sellers and help them get the best price; buyers’ agents, who represent buyers and protect their interests; and agents who represent either (or both).  Often, first-time buyers prefer to work exclusively with a buyer’s agent so there are no possible conflicts of interest.

#9: Doing your homework can help you make a competitive offer.  Before buying the home, determine the property’s market value by having the realtor conduct a comparative market analysis.  This report will show what buyers were willing to pay for similar homes in the area, giving a good idea of what will make a fair offer.

#10: It’s important to have a back-out plan.   Before signing on the dotted line, make sure to have a contingency plan in case things don’t go as planned in the home inspection or appraisal.  If the home has a major flaw or doesn’t appraise for the purchase price, an escape plan allows the contract to be voided.

To learn more about this topic or Wilmington real estate contact me at 910-431-9395 or visit my website:  www.livingbythecoast.com.