NRG First-Time Homebuyer Tips

First-Time Homebuyer Tips

Thinking about buying your first home? Home buying can be a time-consuming and confusing process, but don’t let that intimidate you. We've put together some first home buyer tips and resources to help you reach your goal of home ownership.

How much house can I afford? 

Before you start house hunting, figure out how much house you can afford. A common rule of thumb to follow when figuring out your new home budget is not to spend more than 1.5 times your household income.1 You can also take advantage of home buyer tools such as a home affordability calculator to help you determine what you can afford to spend. It behooves any first-time home buyer to research first-time homebuyer grants and programs before meeting with a mortgage lender to find your best possible mortgage loan. 

If possible, get a pre-approval letter from your loan officer, which is determined based on things like your debt-to-income ratio, credit report, down payment, etc. Consider other homeowner expenses such as home improvements, decorating, furnishing, homeowners insurance and unexpected repairs before settling on a loan amount, but also be realistic about the amount of risk you are willing to take on. Just because you get approved for a certain loan amount does not mean it’s in your best interest to borrow that much money. 

How do I find a realtor? 

Once you know your new home budget, it’s time to find a local realtor with a great reputation to help you navigate the buying process — from finding the actual property to negotiating closing costs. It can also be helpful for first-time home buyers to take advantage of an exclusive buyer agent to help create and guide you through your home buying plan. 

As a first time home buyer, you may not know the difference between the various real estate titles you encounter: real estate agent vs. broker vs. realtors. Not all real estate professionals are realtors, but all realtors are real estate professionals.2 Realtors are held to the standards and ethics set forth by the National Association of REALTORS®, while real estate agents simply hold a real estate license in your state. Brokers have additional education beyond the agent level and for that reason can work alone or hire agents to work for them.  

Whichever type of professional you choose to represent you, make sure you ask them questions about their experience in the local area and their availability to show homes and answer questions, in addition to contract terms and fees you can expect. Covering these details up front can save you time and energy in the long run. 

Buying your first home can be a time consuming, complicated process, but don’t let that stop you from reaching your goal of home ownership. You’re taking the right step in educating yourself before you begin.  

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