Vampires. Werewolves. Zombies. Clowns in storm drains. Homebuying. When this time of year rolls around, many first-time homebuyers have a list of top-five fears that looks something like this. OK fine, sometimes “zombies” are replaced by “creepy dolls.” Regardless of your order, it’s time to employ some fool-proof ways to address that final fear: homebuying. Because it’s not nearly as scary as it may sound.
Below, we’ve collected five common fears about buying a home, as well as solutions that’ll have you resting easy tonight. (Just don’t look under the bed — didn’t you learn anything from Poltergeist?)
1. The paralyzing fear of — that ominous credit score
Does the specter of your unknown FICO score loom over you like a ghost hangs around a graveyard? (Allegedly, that is.) If so, here’s the painless solution: Face your fears head on and determine your credit score — before you even begin the shopping process.
And better yet: It’s FREE!
According to the Federal Trade Commission:
You're entitled to one free copy of your credit report every 12 months from each of the three nationwide credit reporting companies. Order online from annualcreditreport.com, the only authorized website for free credit reports, or call 1-877-322-8228. You will need to provide your name, address, social security number, and date of birth to verify your identity.
With your credit score a known commodity, you can now approach homebuying with confidence. Plus, if you make disturbing discoveries on your report — which may include fraudulent activity, like credit that has been taken out in your name unbeknownst to you — you can work to rectify the errors before you begin the house hunt.
For more info: Here’s the Scoop on Credit Scores
2. The horrifying fear of — not having enough money for the down payment
If dollars that disappear into thin air at the beginning of the buying process have you running scared, consider this: Now is a great time to explore down-payment assistance programs like Home Is Possible. The first step is to spend some time investigating whether you meet the program requirements — for example, to qualify for HIP you must meet certain income and credit qualifications — but we think the prospect of up to 5% of the home’s value as money for down-payment or closing costs may help you overcome your squeamishness.
If you meet the qualifications, the next step is to find a Home Is Possible qualified lender. They’ll help you get thousands of dollars in money and understand the programs you qualify for, courtesy of Nevada Housing Division and the Home Is Possible program.
For more info: To Know HIP Is To Love HIP
3. The terrifying fear of — not being able to afford the home
The best thing you can do while preparing to purchase a home is develop a solid budget with the house payment in mind. Just don’t forget to keep some cash in reserve in case of an emergency. And here’s an insider tip that’ll help you budget other chilling unknowns like energy and water bills: Call your local power company or water authority, give them the property address, and they should be able to give you a general idea of recent monthly costs.
There are several user-friendly budgeting tools that can help you take control of the process. Further resources include a rent-vs.-buy calculator that’ll help you determine if owning a home can benefit you (did we mention tax benefits?).
For more info: Facing A Mortgage Payment Shortfall: Do’s & Don’ts
4. The overwhelming fear of — confusion over the homebuying process
We get it, the documentation alone that goes into buying a home is enough to make your head spin like that possessed maniacal child in The Exorcist. But that’s why you have a team of experts on your side — namely a real estate agent, lender and escrow officer who will explain what you need to do, when you need to do it — and why.
To learn more about the all-important escrow and title-signing process, here’s a tip: Watch this episode of Homebuyer Confidential, which will give you the full insider scoop.
For more info: Excel At Homebuying By Choosing A Winning Team
5. The bone-chilling fear of — a home with bad juju
Lights that turn on and off on their own; creaky staircases and unexplained cold spots; creepy-crawlies nesting in the basement. While these may sound like the ingredients of a horror film, they’re also the very things that a good home inspector will investigate on a buyer’s behalf during a home purchase.
A home inspection can help you gain confidence that your prospective home can help you weather the storms — the real ones, not the imaginary ones that will drive you mad and inspire visions of twins riding trikes down the hall.
And finally, if you prefer security over things that go bump in the night, a home warranty is a solid idea. A warranty costs you money up front, but can protect you from catastrophic problems that could devastate your budget. (Think: an unfixable air conditioner in the middle of summer. The horror!)
Look at us, zapping fears like the Ghostbusters annihilated the Stay-Puff Marshmallow dude! If you’re still a bit queasy about the prospect, we recommend you start by consulting with a HIP-qualified real estate agent and lender. Or poke around our blog if you’d like to get sucked into a vortex of information awesomeness.
And Happy Halloween, one and all!