Purchasing a home is a significant milestone, but for many first-time buyers, the process can feel overwhelming when buying your first home. 

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“From understanding mortgage options to saving for a down payment, first-time buyers are facing many decisions that will have long-term ramifications,” said Manuel Salazar, chief executive officer of Take Charge America, a national nonprofit credit and housing counseling agency. “By having a clear plan and considering all options available, first-time buyers can make confident choices to support their financial future.” 

Salazar shares four tips to help first-time homebuyers assess affordability and determine whether the timing is right to make the purchase:  

  • Assess Renting versus Buying: Choosing between renting and buying depends on your financial situation, long-term goals and market conditions. Renting offers flexibility and lower upfront costs, while purchasing a home allows you to build equity over time and customize your living space. However, homeownership comes with ongoing expenses beyond the down payment and mortgage that can add up quickly. Ensure these costs won’t strain your budget or compromise your ability to meet other financial obligations. 
  • Evaluate Total Home Budget: Owning a home comes with several upfront and ongoing financial commitments. These include the closing costs, mortgage payments, property taxes, insurance and maintenance expenses. Factoring these costs into a search will give you a better understanding of what you can comfortably afford without overextending your finances. 
  • Understanding Loan Pre-Approval & Pre-Qualification: Pre-qualification provides a rough estimate of your borrowing power and can help start the house-hunting process. Once you find a home you’re interested in, securing loan pre-approval demonstrates serious intent to sellers and may give you a competitive edge in the buying process. 
  • Explore Down Payment Assistance: Many first-time buyers struggle to save up for a down payment and are often unaware that assistance is available to expedite that reality. These programs, typically offered through state housing finance agencies as well as city and county governments, provide financial support through grants or low-interest, deferred payments or forgivable loans. Designed for first-time buyers, eligibility for these programs is based on income thresholds, property location restrictions and completing a homebuyer education course. 

For more resources, visit Take Charge America’s Make Your Move…A Guide to Homeownership. This online, self-paced course meets the education requirement for many down payment assistance programs upon completion with a passing score.