Essential Tips for First-Time Home Buyers

May 15, 2020 | By:Neilson Marketing Services

Purchasing a home can be nerve-wracking, especially for first-time home buyers. First and foremost, you will need to have savings and know your options. Also, be sure your home is protected from a variety of common mishaps. Utilize these tips to help you navigate the process, save money and avoid common mistakes. 


Before you start looking for your dream home, you need to know what’s actually within your price range. It’s common to put 20% down. Even though some lenders now permit less, going lower than 20% may mean higher costs and paying for mortgage insurance.

Play around with a down payment calculator to help set a goal amount. It may be helpful to set aside tax refunds and work bonuses, set up an automatic savings plan and use an app to track your progress.

Down Payment and Mortgage

There are many mortgage options out there. Check out these loan types:

Conventional mortgages

They conform to standards set by the government-sponsored entities and require as little as 3% down.

FHA loans

Loans insured by the Federal Housing Administration permit down payments as low as 3.5%.

VA loans

Loans guaranteed by the Department of Veterans Affairs sometimes and may require no down payment. 

If you want the lowest mortgage payment possible, choose a 30-year fixed mortgage. However, if you can afford larger monthly payments, you can get a lower interest rate with a 20-year or 15-year fixed loan. You will want to crank some numbers to figure out what mortgage is a better fit for you. You may even prefer an adjustable-rate mortgage, which is riskier but guarantees a low interest rate for the first few years of your mortgage.


Your credit will be one of the key factors in determining whether you’re approved for a mortgage loan, and will help determine your interest rate and possibly the loan terms.

Check your credit before you begin the home buying process. Dispute any errors that could drag down your score and look for opportunities to improve your credit, such as tackling debts.

To prevent your score from dipping after you apply for a mortgage, avoid opening any new credit accounts until your home loan closes.

Pre Approval

You can get pre-qualified for a mortgage to get an estimate of how much a lender may be willing to lend based on your income and debts. The lender thoroughly examines your finances and confirms in writing how much they are willing to lend, and under what terms. This letter makes you look much more serious to a seller, which can give you the upper hand over buyers who haven’t taken this step.


House and Neighborhood 

Are you looking for more space or low maintenance? Extra amenities or no homeowner’s association fee? Even if the home is right, the neighborhood could be all wrong. It is in your best interest to research nearby schools (even if you don’t have kids, since they affect home value), look at local safety and crime statistics, map the nearest essential amenities (hospital, pharmacy, grocery store) and drive through the neighborhood on various days and times to check out traffic, noise and activity levels.


Homeowners Insurance

Before you officially own a new home, your lender will require you to secure homeowners insurance. Look closely at what’s covered in the policies, as this protection goes quite a long way when you need it most. Getting the best CA home insurance is well worth it, as you will not only be able to close on the house and have peace of mind, but you will be prepared for many unfortunate events that you couldn’t have planned for. 

About Allegiant Insurance Services

At Allegiant Insurance Services, we specialize in providing personalized and tailored insurance solutions to fit your individual needs. We pride ourselves on providing cost-effective policies in the home, business and auto markets with a human approach. Contact us today at (858) 771-2000 to receive a free quote or to speak to a reputable and helpful agent. 

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