First-Time Home Buyer in Gilbert, AZ: 14 Things to Know

Lori Gelder

Owning a home is a cornerstone of the American dream. For many, it’s a significant life achievement, a place to build memories, and an investment for the future. First-time home buyers make up roughly 30% of all home buyers each year, according to Self Financial. If you're considering taking the leap into homeownership in Gilbert, AZ, here's a comprehensive guide to help you navigate this exciting journey.

Fast Facts about First-Time Home Buyers

  • In 2021, there was a noticeable rise in first-time homebuyers, with 34% entering the market, up from 31% in 2020.
  • A survey from BankRate shows that first-time homebuyers, on average, are around 33 years old.
  • The primary driving force for 65% of first-time homebuyers is the allure of owning their own space.
  • Over the past few years, starting from 2018, first-time homebuyers have been putting down payments in the 6% to 7% range.
  • Finding enough money for a down payment was deemed the most challenging step by 29% of first-time homebuyers.
  • Last year, 28% of newcomers to home buying utilized a gift or a loan from their loved ones to bolster their down payment.
  • Student loan debt is a major hurdle for many potential buyers. Among younger millennials, 49% said it impacted their savings, while 44% of older millennials echoed this sentiment.

Preparing for the commitment of a mortgage

Before diving into the home-buying process, it's essential to mentally and financially prepare for the commitment of a mortgage. Understand the responsibilities that come with a home loan and ensure you're ready to take them on.

Importance of getting pre-approved

Never underestimate the importance of a mortgage preapproval. Not only does it offer clarity on what you can afford, but it also signals to sellers that you are a serious buyer.

Taking care of your credit

Your credit health is paramount during the home-buying process. It influences your mortgage rates and approval odds. Stay on top of your credit reports and dispute errors promptly. Refrain from opening new credit accounts, as this can affect your credit score.

Setting aside funds for your down payment

Start saving early for your down payment. The larger the down payment, the lower your monthly payments might be. Moreover, having a substantial down payment can make you a more attractive buyer in a competitive market.

Familiarizing yourself with mortgage options

It's crucial to explore mortgage options and understand the difference between conventional loans, VA loans, FHA loans, and USDA loans. This knowledge will help you determine the best home loan for your situation.

Budgeting for the closing costs

Many first-time homebuyers are unaware of the additional expenses, like closing costs, that come with a home purchase. These can range from 2% to 5% of the home's purchase price, so be prepared.

Identifying your priorities for your new home

When house hunting, make a list of your needs, non-negotiable aspects, and bonus features. This will streamline your search and help you find your dream house faster.

Partnering with a professional real estate agent

A good real estate agent can make all the difference. They'll guide you through the local market, offer valuable first-time home buyer tips, and ensure you make informed decisions.

Making a confident offer

When you find the right property, work with your real estate agent to submit a compelling offer. Confidence can play a crucial role in getting your offer accepted in a competitive market.

The necessity of a home inspection

Never skip the home inspection. It offers a deep insight into the property's condition and can save you from potential future expenses.

Adhering to your financial limits

It's easy to get swept up in the excitement of home buying, but always stick to your budget. Remember, the monthly mortgage payment isn't the only expense – consider property taxes, maintenance, and other associated costs.

Keeping track of essential documents

While everything might be going digital, it's a wise move to keep physical copies of all home-buying paperwork. This can be beneficial for future reference or disputes.

The learning never stops

Even after buying your first home, continue to educate yourself. The real estate market is dynamic, and there's always more to learn.

Navigating first-time home buyer national programs

Traditional mortgages

These are standard loans not insured by the Federal Housing Administration and are suitable for borrowers with good credit scores.

Veterans' housing loans

VA loans, backed by Veterans Affairs, are tailored for veterans and come with benefits like no down payment and favorable interest rates.

Federal Housing Administration loans

FHA loans, backed by the Federal Housing Administration, are popular among first-time homebuyers because of their lower credit requirements and minimal down payments.

Agriculture-focused mortgages

USDA loans, targeted at rural areas, offer 100% financing and are backed by the U.S. Department of Agriculture.

About Lori Gelder

Lori Gelder stands out as one of Arizona's premier residential real estate mavens. If you're looking to buy or sell a home or have any questions about the Gilbert, AZ real estate market, contact Lori Gelder today.

*Header photo courtesy of Shutterstock

Work With Lori

Lori strives to put her clients first and dedicates her time to making their process as smooth and seamless as possible. Lori also realizes this is one of the largest investments of your life, and is grateful to be on your personal real estate journey with you.