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9 Expert Tips for First-time Homebuyers

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

9 Expert Tips for First-time Homebuyers

Buying your first house can be an excellent test of patience, endurance and resilience. If you’ve never been through the process before, it can certainly be an intimidating one. From scary terms and bidding wars to that tiny matter of plunking down a whole heck of a lot of money for a down payment, most people who are buying their first homes could stand to use a little help along the way.

We’ve tapped into some experts from across the country to find out what their top tips are when helping first-time homebuyers find and purchase their dream houses. Use some of these whenever it’s your turn to take a ride down Homebuyers’ Lane.

Tip No. 1: Determine a comfortable budget

Expert: Russell Vilt, Managing Broker & Owner Excel Condos, Chicago, IL

What it means: Nothing can be done when it comes to buying a home without first understanding your budget. “I always suggest speaking with a lender who can help determine their buying power,” says Vilt. “The sales price of a home is not the only expense, so they need to be aware of taxes, assessments (if it’s a condo), homeowners’ insurance, etc.”

A tip from MagnifyMoney: be sure not to let a mortgage lender or realtor talk you into buying more than you can truly afford. Just because you get approved for a $300,000 mortgage, it doesn’t mean you should get a $300,000 house. You should also learn how to hack your way to a cheaper mortgage.

Tip No. 2: Get pre-approved by a lender as soon as you think you want to purchase a house

Expert: Rhonda Fee, broker/realtor, Aspire Realty Services, Pleasanton, CA

What it means: Pre-approval will be your road map for a successful purchase, which is why it’s so important to get this part rolling right away. “Understand what bills need to paid off, and how much down payment you’ll need,” says Fee. “The lender should be someone they have been referred to by a friend who had a successful transaction with that lender, or … a realtor. A lender can kill a deal if they are not on top of their game.”

Check out this piece for more about what to know before getting pre-approved for a mortgage.

Tip No. 3: Know what loans are available to you

Expert: Tory Sheffer, realtor, Berkshire Hathaway HomeServices, Michigan

What it means: Sheffer has come to realize that most first-time homebuyers tend to know the basics about buying a home — like what a mortgage is, for example — but that’s about it. “They aren’t aware of the different options available to them with Conventional, FHA, Rural Development and 80/10/10 Piggyback loans to help buyers who do not want to pay Private Mortgage Insurance,” he said. To help, Sheffer makes sure to take some time and explain to his clients the difference between these additional options. For example:

  • Rural Development is a zero down payment program
  • FHA is a 3.5% down payment
  • 80/10/10 is a 10% down payment with 10% as a second mortgage to avoid PMI, which in turn lowers the monthly rate, more often than not
  • Conventional Mortgages are not insured by the federal government, but more often than not PMI is required until the buyer has built 20% equity in their home. Learn more about why you should aim for a 20% down payment.

Ask your broker or lender for more specific information about each. 

Tip No. 4: Find an agent you trust, and don’t be afraid to shop around if your agent isn’t meeting your needs

Expert: Leize Gaillard, agent, William Means Real Estate, Charleston, SC

What it means: As with any other large purchase you would make, it only makes sense to shop around for the best options. “I find that the agent/buyer bond is particularly strong with first-time homebuyers,” says Gaillard, “as the buyers often need extra detailed explanations of each step in the process. This certainly takes more time, effort and patience on the part of the agent, and not all agents are naturals in this department.” It’s important to feel comfortable with your agent, like you can ask questions and get reliable answers, and a patient agent will work hard to earn your trust and business, and will stick with a first-time buyer without making them feel rushed. 

Tip No. 5: Don’t fall in love with houses you see online

The expert: Wendy Roudybush, Broker, Jamboree Homes, Colorado City, CO

What it means: Unfortunately Roudybush has seen it happen all too many times — a first-time homebuyer finds something online that looks great, falls in love with it, and then is disappointed when seeing it in person. “It can be very different in person,” she says. “Also, when looking at houses, don’t make snide comments about the house in front of the seller or the seller’s agent — it won’t endear you, and it could make it difficult to get your offer accepted. Understand how the real estate industry works.” 

Tip No. 6: Unless you have lots of extra cash, forgo foreclosures, auctions and bank sales

Expert: Leize Gaillard, agent, William Means Real Estate, Charleston, SC

What it means: Gaillard says she is often presented with first-time homebuyers who expect to get their dream home for 20% or more under market value through a foreclosure, auction or bank sale — but there are stipulations with these types of sales. “What these buyers don’t understand is that by the time homes have reached the open market, they have been left vacant in poor condition for some time,” she said. “Simply getting them back in reasonable habitable condition could take thousands of dollars in maintenance work. It isn’t to say there won’t be some good foreclosure deals out there, but in general, if it looks too good to be true, it probably is.” 

Tip No. 7: Visit at least 20-30 properties in person before making a decision

Expert: Ari Harkov, Harkov Lewis Team at Halstead Property, New York, NY

What it means: There are many factors that go into determining your perfect home, and it takes a developed eye to pick up on them. “Price, neighborhood, immediate street, size, views, condition, monthly carrying costs, etc.,” says Harkov, are all factors to consider. “Searching online is incredibly value, but nothing replaces in person visits. Taking the time to visit numerous properties through private appointments and open houses will allow you to confidently narrow in on your preferred criteria and make an offer with confidence once you do find a home that you love.”

Tip No. 8: Don’t be afraid to look everywhere

Expert: Will Johnson, realtor and founder of the Sell and Stage Team, Hendersonville, TN

What it means: It can be intimidating to check out houses the first few times, but just remember how much money you’ll be spending if you were to buy the place, and use that as incentive to put your nosiest foot forward. “Open drawers, cabinets and closets to see how much storage space you really have,” says Johnson. “Turn lights on and off. Walk down to the basement or up to the attic and look for smells and leaks.” On the other hand, Johnson says to remember that there are elements about a house that you can change. “Don’t miss out on a great house because you don’t like the paint or the appliances,” he said. “These are small parts of a bigger picture. Try to imagine the house as your own.”

Tip No. 9: Read your contract

Expert: Will Johnson, realtor and founder of the Sell and Stage Team, Hendersonville, TN

What it means: While it might seem like a bunch of “standard legal jargon,” you need to understand everything that’s in your contract, says Johnson. “If you’re confused about something, ask your realtor or attorney.”

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Cheryl Lock
Cheryl Lock |

Cheryl Lock is a writer at MagnifyMoney. You can email Cheryl at [email protected]

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Here’s Why Single Women Are Buying More Homes Than Single Men

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

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Right after she turned 30, public relations pro Wendy Hsiao put in an offer on a cute brick townhouse in Atlanta. “For a lot of my friends, being an adult started either when you got married or had a baby,” she said. “I chose to buy a house.”

Why did she buy? She felt ready for a major life change, considered buying to be a smart financial decision and wanted a yard for her Pomeranian named Georgia. “I felt like it was time to make a place my home,” Hsiao said.

Her story is one example of a growing trend: the rise of single female homeownership. Single women are far more likely to become homeowners than single men, according to a study on singles owning homes by LendingTree, which owns MagnifyMoney. In fact, single women own 22% of homes on average, while single men own less than 13%.

This “gender gap” stems partly from the fact that single women prioritize homeownership when setting life goals. In fact, 73% of single women list owning a home as a top priority compared with 65% of single men, according to the 2018 Homebuyer Insights Report from Bank of America.

Single women are “skipping the spouse and buying the house,” according to the Bank of America report, which found that single women rank homeownership as a goal above getting married (41%) and having children (31%).

From homemaker to homeowner

While there’s still work to be done, women have taken huge steps toward professional and financial independence. Homeownership in particular contributes to economic stability, so it’s great that more single women are buying homes. There’s no doubt the increase in the number of women in the U.S. workforce, a figure that has more than doubled since 1975, has contributed to the trend. Here are some other driving forces behind the rise of single female homeownership:

Homeownership empowers women. Homeownership offers a place to live, stability and a way to build wealth, so it’s no surprise women view owning a home as empowering. In fact, 31% of single women (vs. 23% of single men) feel empowered when thinking about buying their first home. A licensed real estate agent in Chicago, Martina Smith bought a condo in her dream neighborhood of Streeterville after she broke off an engagement a few years ago. Her budget only allowed her to buy a “fixer-upper,” but she got a great deal and renovated her place. “It’s been very rewarding and empowering,” she said. And she thinks it reflects a bigger national trend. “We’re seeing more women taking charge,” Smith said.

Women are becoming more educated. Over the past few decades, women have become more educated than men. In 2017, 38% of women and 33% of men ages 25 to 64 had a bachelor’s degree. In that age group, 14% of women and 12% of men had an advanced degree. And women are putting off marriage to pursue that education, according to the 2018 Women in the Housing & Real Estate Ecosystem report. Educational attainment has a positive impact on homeownership rates.

Women are done waiting to marry. There’s been a cultural shift where women no longer feel they need to wait until they pair up to embark on certain aspects of “adulting,” said Kelley Long, a CPA and certified financial planner with Financial Finesse. “I will never forget a friend’s dad chastising me for doing ‘nesting’ things like buying nice furniture before I was married because of his perception that you just don’t do things like that until you’re married,” Long said, adding that women are “rejecting that idea because it’s not true.” If you want to marry in the future, the right partner will likely be impressed that you were financially secure enough to buy a home on your own, she said.

Single moms want a home base to raise kids. “Oftentimes, when people buy homes it’s for lifestyles reasons,” said Tendayi Kapfidze, chief economist for LendingTree. Getting married is one big reason, but having children is the other, he said. About 21% of U.S. kids live with single moms, a number that has almost doubled since 1968. In contrast, just 4% of kids live with single dads. “Children prompt people to buy homes,” he said. “So that might be one of the factors at play.” And it’s not just kids. As many as eight in 10 caregivers for elderly parents are women. The median age of a single female buyer is mid-50s, points out Jessica Lautz, vice president of demographics and behavioral insights for the National Association of REALTORS. A single female homebuyer “may be coming from a past relationship and purchasing a new home for herself, her children and her parents,” Lautz said, adding that single females are “willing to make sacrifices” to purchase a home.

So what does the future hold for single women owning homes? If marriage rates among all U.S. adults continue to drop, it’s likely the number of single women purchasing homes will rise even more, Lautz said.

Turn your homeownership dreams into reality

Strict lending standards can make it more difficult to qualify for a mortgage on a single income. Considering women also only make 80% of what their male colleagues earn, getting to a financially secure enough position to afford homeownership may feel daunting. Here are three tips for single women looking to buy a home of their own:

  1. Prep your finances for homebuying. It’s important to check your credit and your debt-to-income ratio before you start the homebuying process. If you spot problems, work on increasing your credit score and paying down your debt before you try to get preapproved for a mortgage. Getting the best possible rate can save you money over the life of the loan, which is especially important when your household depends on a single income. The upside is that single women have complete control and don’t need to worry about anyone else’s shaky credit or loads of debt. “If you’re in a couple, somebody is going to be dragging the other person down,” Kapfidze said.
  2. Build your nest egg before you buy. Forty-eight percent of women say they haven’t purchased a home yet because they haven’t saved enough for a down payment. But that’s not the only savings barrier to breach before taking the leap into homeownership. “Make sure you have a robust emergency fund,” Kapfidze said. Because single homeowners are on their own, they should set aside at least three months of mortgage payments as part of their emergency fund, Kapfidze suggested. “If you’re single, you’re the only one with income coming in to pay the mortgage,” he said.
  3. Pick a home that comes in under budget. Single women have lower household incomes than single men, so they may need to consider buying a smaller home, taking on a house that needs some work or settling in a lower priced neighborhood. The good news is that single women may be doing exactly that. In fact, the average home purchased by a single woman cost $173,000 compared with over $190,000 for a single man. Single women “may need to make price concessions when purchasing to find a home for themselves and their families,” Lautz said. And buying less house than you can afford can help you make your mortgage payment more easily if you hit financial hard times in the future.

Finally, it’s normal to feel stressed when you think of buying a home. In fact, more women (40%) than men (30%) feel overwhelmed by the idea of homeownership. But even though the homebuying process was scary, Hsiao said she has zero regret about buying a home of her own: “If you love the house, it’s 100% worth it.”

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Allie Johnson
Allie Johnson |

Allie Johnson is a writer at MagnifyMoney. You can email Allie here

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