First Time Home Buyer? Advice You Need to Know

  • By Jeremy Thompson
  • 15 Jul, 2015
Summer season brings out more and more potential home buyers for various reasons including families who wish to settle into a new home before the school year starts, or due to a relocation, or just because summer is a better time to move than in the midst of winter. Some buyers may be first time […] The post First Time Home Buyer? Advice You Need to Know appeared first on J. Thompson Builders.
Some buyers may be first time home buyers, satisfying the American dream of homeownership. While many rush into buying a home, excited at the prospect, it’s wise to slow down and consider what you should know as a first time home buyer. These apply whether you are building or purchasing an existing home.
For example, you should check your credit. An inaccurate credit report or low credit score may affect your financing, and it takes two months for the credit score to improve after you’ve corrected a mistake or paid down on an account. Order a report at least three months in advance of applying for a home loan. Through the Fair Credit Reporting Act, you are entitled to receive a free copy of your credit report once a year.
Here are some other things first time home buyers should keep in mind….
Get preapproved:Contact your lender for a preapproval letter. The lender will require you to apply for a loan, and the letter shows the lender has confirmed what type of loan you qualify for, and that they are agreeing to process the loan.
Truly understand what you can afford:Base this on what you earn now, not what you expect to earn at any point in the future, even if a big job offer or a promotion are in the works.
Understand what you have to pay for:While renting requires a flat monthly cost, a mortgage payment includes homeowner’s insurance, property taxes, and sometimes homeowner’s association fees or private mortgage insurance (PMI). Understand these costs because they can raise your monthly payment by hundreds of dollars.
Have a wish list, but don’t expect perfection:There is no perfect home, whether you are purchasing an existing home or building from scratch. Your budget may determine how much you have to compromise on your wish list, but even if you have “all the money in the world” you still won’t get every single thing you would like to have in a home. Start a wish list with this in mind, and decide what you are willing to give up, and what items are absolutes, yet remain flexible.
Invest in an up and coming area:A home is an investment, and one of the best ways to save money yet benefit in the long run is to build or buy a home in an area less developed that is poised to become a hot spot. Your realtor or builder may be able to offer advice on such areas, or you may have to do some research of your own.
Thing long-term:Are you planning to stay in the house long-term, or care for your aging relatives. If so, you’ll want to consider how the home will suit your needs for all life stages. One of the services J. Thompson Builders provides is accessible living building , including home plans , which allow you to stay in your home for much longer as you age, or as you begin to move in and care for your elderly relatives.
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By 7052540976 15 Nov, 2017
Some of these considerations may not be in the forefront of your mind, but there is a long list of aspects you need to consider when building a new home. These should help to get you started thinking about some of the most important pieces of the home building process.
By 7052540976 15 Oct, 2017
This home is being built with our client’s specific wants and needs in mind. The homeowner
requested a single family home with a modern contemporary house design. Previously, he lived
in a townhome and desired a more private, spacious residence. A main floor living with a large
space to entertain and big volume ceilings were a must on the client’s list.

The client decided building as opposed to finding a pre-existing home was a better solution for
him because he wants something specific to his needs. He already had the perfect location in
mind and it was time for him to own his dream home.

The area is ideal for this client because it allows him to live in close proximity to his hobbies and
interests and it also allows him the ability to walk to nearby restaurants or bike to the
surrounding shops. This homeowner will be close to everything. He truly loves the location!
The design concept picked is pictured below. In sticking with a contemporary influence, the
design has clean, simple lines that will result in an extraordinary modern home. We combined
elements of residential and commercial materials and design to bring our client’s unique requests to life.
By 7052540976 15 Sep, 2017

You decide that you are ready to build a custom home for you and your family. Now it is time to figure out how to finance your dreams!

Let’s start with the basics. As with any loan process, do your research. Talk to several mortgage companies that specialize or have a strong understanding/history of working with construction loans. Ask questions and voice your concerns. Companies of course want your business, but they also want to make sure they are a good fit for you and what you are wanting to accomplish. Reviews and referrals are strongly regarded these days. They want to make sure you have the best experience possible.

There are several main differences between a construction loan and a regular existing home loan. An individual construction loan may require a longer credit history  or a higher credit score as well as more money down and along the way. It is more of a process, but it is most certainly worth it. With the right builder, the more involved process becomes a piece of cake; but, that is an article for another time.

Home loans can have a 30 year term whereas a construction loan typically has a max of 1 year. “The rates on this type of loan are higher than rates on permanent mortgage loans. To gain approval, the lender will need to see a construction timetable, detailed plans and a realistic budget, sometimes called the “story” behind the loan,” as reported by  bankrate . While your home is being built, it is typical to make interest-only payments. 

If you are thinking, “I don’t have enough money to pay off a newly built home in 1 year!” Don’t panic.

A popular option is the construction-to- permanent financing sometimes called “one-time close,” a “single close,” or an "all-in-one" loan. Upon completion of construction, the remaining loan balance is converted into a permanent mortgage with terms up to 30 years. Like most loans, “the rate and other terms of the permanent mortgage are set up-front when the entire loan package is closed” according to the  National Association of Home Builders .  Construction/permanent loans are offered by many different lenders, including banks and mortgage companies and are a great option for those of us wanting to finance their home purchase over an extended period of time.

Another option is a stand-alone construction loan. This type of loan can be beneficial if you currently own your home and want a smaller down payment option.   Read more about stand alone construction loans.

There are many different loan options. What makes sense for one person doesn’t make sense for everyone. Make sure you find the right product for you and your particular project. If you want to talk over some options, contact us! We would love to hear your ideas and figure out how we can build your dream home.

View our work , read our reviews on Houzz.com , and visit our Facebook page to get inspired!
By Jeremy Thompson 01 Aug, 2017
Your home should work for you, your family and the way you live. Sometimes a new custom home isn’t the answer yet. When you need to maximize the space in your current home, find clever ways to make your space more usable by maximizing storage in unique ways. Platforms add additional space and a new […] The post Clever Remodeling Ideas to Maximize Storage Space appeared first on J. Thompson Builders.
By Jeremy Thompson 15 Jul, 2017
The internet puts an incredible amount of information at your fingertips. Why would you not take advantage of it to get home remodeling advice? Often it isn’t created by experts in the field. Here are 3 remodeling myths you may have read or heard about and the truth you need to know to understand how […] The post 3 Remodeling Myths and Tips appeared first on J. Thompson Builders.
By Jeremy Thompson 01 Jul, 2017
With more and more people working from home or taking at least the occasional “work from home” day, the home office has become an essential part of a home plan. Even if you don’t work from home ever, the home office is still a great area to work on creative projects, store important files, or […] The post Designing a Home Office: Increasing Productivity, Inspiring Creativity appeared first on J. Thompson Builders.
By Jeremy Thompson 15 Jun, 2017
We’ve offered you lots of advice over the years about building a custom home. Here is a condensed version of some of the most important tips to follow. Get on the fast track to planning your new custom home! 7 Tips for Building a Custom Home Pay attention to your subdivision covenants. Yes, these are […] The post Building a Custom Home: 7 Quick Tips appeared first on J. Thompson Builders.
By Jeremy Thompson 01 Jun, 2017
Whether building a house or undertaking a remodel you have the opportunity to design your house to suit your tastes and needs. There are many flooring options available, each with unique characteristics and design. Since flooring is a long-lasting part of the house it is important to choose the right floor for each room that […] The post 5 High-Quality Flooring Options Available for Your Home appeared first on J. Thompson Builders.
By Jeremy Thompson 15 May, 2017
Building a new home is an exciting time, filled with anticipation and satisfaction as you watch your vision come to life. However, it can also be a little overwhelming when you’re unfamiliar with some of the technical terms. To help remedy this we’ve defined a few of the custom home building terms you may hear […] The post 5 Key Terms to Understand in Custom Home Building appeared first on J. Thompson Builders.
By Jeremy Thompson 01 May, 2017
Whether you’ve just unpacked your first box or you’ve been living in your house for years, chances are there’s something about your home you’ve desired improving. However, before beginning a project there are a few key home remodeling terms you should become familiar with. Understanding these terms will help you navigate conversations with your remodeling […] The post 6 Key Home Remodeling Terms to Understand Before Beginning a Project appeared first on J. Thompson Builders.
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