The process of buying a home in Utah can be difficult and stressful. Luckily, McArthur Homes are experts in the home building industry and offer many tips on buying property in Utah. Follow this guide for first-time home buyers to get you on the right track.

Pre-qualification

Getting pre-qualified is a great first step in finding the perfect home for a you and your family. Pre-qualification will tell you exactly what price range you qualify for and allows you to determine what home you can afford. Pre-qualification also helps the realtor know what price range of homes to look for. Another benefit of pre-qualification is that loan officers can give an approval letter that lets realtors know you are a serious buyer and can speed up the loan processing time.

Know What Type of Home You Want

Figure out what kind of home you want and make a list of features you desire in a home. How many bedrooms will you need in the near future? Do you want a home or a condo? Are you sick of having neighbors so close in apartments? Make sure you are planning for the future and not just what you need at the moment.

Along those same lines, look for places you would be willing to live. Decide if you are okay looking at older homes that may need some work, or if you want and can afford a newer home. There are many decisions to be made which require some thinking.

Checklist for First-Time Home Buyers

A checklist for first-time home buyers is a necessity so that nothing is left out of the process. A checklist should include anything you will need along the search and purchase steps. A list to get started includes:

• Enough money – While having sufficient funds may seem obvious, some home buyers don’t always plan finacially for everything they may need. Potential buyers need to plan for the unexpected or hidden costs like closing costs, utility payments, realtor fees, etc. Buyers should plan for anything that could possibly be added to create a buffer.
• Start gathering paperwork – Gathering paperwork now will make for an easier process in the future. First-time home buyers should start collecting federal income tax statements, recent paycheck stubs, credit card information, student loan information, utility bills, and any other information a loan provider may want to see.
• Consider loans – Do you want a 15-year or 30-year loan? 15-year loans give better interest rates, but obviously the payment is higher. There are also fixed-rate mortgages and adjustable-rate mortgages. Adjustable-rate mortgages typically have lower interest, but are subject to change over time and could go much higher.
• Credit record – A credit record is an important part of buying a home. Do what you can to raise credit and pay down large debt. A score of 720 and above is generally considered good, while 750 to 850 is excellent. Good credit allows for better interest rates and more loan options.
• Down payment – Most experts suggest a 20% down payment. While this is hard for many people, there are options out there for little to no down payments. Some of the upsides to having a large down payment are lower monthly payment and possibly not having private mortgage insurance.

Financing

One of the biggest tips for first-time home buyers in Utah is to get the right financing. Some loans offer first-time home buyer programs with many great benefits to buyers in Utah. These loans can offer things like no income limitations, no private mortgage insurance, seller contribution to closing costs, and more. As stated before, the bigger the down payment, usually the better the terms of the loan.

More tips on financing include getting pre-approved before searching for a home, deciding how much of a down payment you can afford, and finding a lender you are comfortable with. Just remember there may be a large difference between what you get approved for and what you can actually afford.

Other Tips on Buying Property in Utah

 

• Look at all expenses – Expenses include much more than just the price of the home and the associated costs. Aside from the principal amount, interest, and taxes/insurance, new homeowners must also consider utilities, commuting costs, upgrades, and home necessities such as a lawnmower or furnishings. It can be a good idea to call the utility companies to try to get an estimate of costs before you commit.
• HOA fees – If you want to live in a neighborhood with HOA fees, you need to be aware of how much they are and if they could potentially increase. Homeowners Associations sometimes also do not allow renting of certain properties and could have varying laws ranging from no pets to not being able to leave the garage door open too long.
• Grants and other funding – There are many grants available to homebuyers today that many people don’t know about. The Good Neighbor Next Door program is a program for firefighters, police officers, and teachers that allows them to buy HUD homes for 50% off when they meet the qualifications. As you search for a home, look at all available grants to see if you qualify for any.
• Think long-term – Although it may be hard, every home buyer should keep long-term plans in mind when searching for a home. Are you going to have kids or anybody else coming to live with you? Will you stay there for years? How easy will the home be to resell? These are important questions that any homeowner should think about before making the leap into new home ownership.