5 Bonus Tips for Buying Your First Home
I work with clients across the entire spectrum of life. Some are college students just learning about Roth IRAs, others are millennials growing their careers and families, and many are retirees enjoying the fruits of long-term financial planning. Because wealth typically builds over a lifetime, I do work with a lot of retirees… or at least people who have already purchased a home.
Lately, though, I’ve had the pleasure of talking with a few young clients navigating the home-buying process for the first time! Back in 2019, I wrote a blog called 5 Important Tips for Buying Your First Home, but I realized there’s so much more to cover. So, here are 5 more tips to help first-time homebuyers tackle this exciting (and sometimes overwhelming) milestone.
1) Cash is King
If you’re planning to buy a home within the next five years, start saving cash like you’re gathering the last drops of water in the middle of a desert. You’ll need money for:
- Your down payment (at least 5%, ideally 20%)
- Closing costs (maybe 2–5% of the purchase price)
- Home inspections ($300–$500)
- Cleaning and moving
- Furniture and other essentials
I’ve never met a first-time homebuyer who regretted having too much cash on hand. Being financially prepared makes the process far less stressful.
2) Find a Great Mortgage Lender
It’s hard to know what you can afford without speaking to someone in the industry. A good mortgage lender will review your income, credit score, employment history, and current debts to determine the loan size and interest rate you may qualify for.
You’ll need a preapproval letter before seriously house-hunting. Please remember that just because you’re approved for a certain amount doesn’t mean you should spend it all. Buying below your means gives you more flexibility for life’s unexpected expenses.
Shop around! Ask friends and family about their experiences and remember that the lender you choose can impact your closing costs. The lender works for YOU—not the other way around. You are literally paying them, so you have the right to ask questions and find the best option.
3) Ask Around About Home Insurance and Property Taxes
Property taxes and home insurance costs vary widely between towns and school districts.
Before putting in an offer, make sure you understand these ongoing expenses and factor them into your monthly budget.
Your realtor can help with property taxes, and your insurance agent can provide accurate quotes.
4) Budget for Ongoing Maintenance
The thrill of getting your new keys can quickly fade when things inevitably break—a furnace fails, a roof leaks, or the dishwasher dies. As a homeowner, there’s no landlord to call. There’s just you.
A good rule of thumb is to save 1–2% of your home’s value annually for maintenance. For a $250,000 home, that’s $2,500–$5,000 a year. It may feel like a lot, but being financially prepared makes repairs far less stressful.
5) Understand the Timeline
Buying a home takes time… often longer than people expect. From the day your offer is accepted to the day you get the keys, expect 30–60 days, and that’s after weeks (or months) of house-hunting.
During this period, you’ll juggle:
- Home inspections and potential negotiations for repairs
- An appraisal ordered by your lender
- Detailed financial underwriting
- Gathering and submitting paperwork
Knowing the process ahead of time helps you stay patient, plan your lease or moving arrangements, and avoid panic when things feel slow.
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Buying your first home is exciting, challenging, and sometimes overwhelming, but preparation is everything. With cash saved, the right lender, a clear budget, and realistic expectations, you’ll set yourself up for a smoother, more confident experience!
