After months of watching friends and family upgrade and move into new abodes, it just might be time for you to set sights on purchasing your first home in the Golden State. 

Searching for a home and closing on a property has never been easier due to advances in real estate technology. But despite the ease of search, first time home buyers in California must follow foundational keystones to stay ahead throughout the home buying process. 

To help aspiring homeowners understand how to get their search started right, we’ve compiled a list of the essential first time buyer tips for Californians trying to get on the property ownership ladder.

Set up a savings plan

Starting up a savings plan is the first step for first time California homebuyers. It is essential that they begin saving for down payments well before starting their search to create a surplus. 

While some lenders offer lower rates, most require buyers to shell out 20% of the listing price in the form of a down payment. Unprepared shoppers have had homeownership dreams dashed because they did not save enough for a down payment and closing costs.

Luckily, there are plenty of ways to save money for budgeting, and it pays off to start sooner than later. Start by creating a monthly budget to track spending, skipping vacations for a year or two, and cook at home over ordering out. 

But the best way to save is setting up automatic deposits into a savings or brokerage account. Putting away a few hundred dollars each month for a few years builds capital quickly.

California homebuyers should build as big of a nest egg as they can. But there are first time homebuyer programs available in California and down payment assistance grants that help aspiring buyers pay for a down payment. 

Hire an Agent

Some first-time homebuyers researching the home buying process on YouTube and Reddit may feel as if they can represent themselves in a real estate transaction. But a sizable amount of paperwork, research, and effort goes into each real estate deal and can quickly overwhelm unprepared and fledgling buyers. 

Home buying is a complicated transaction requiring an expert to help navigate the negotiation process, but each agent brings different experiences to the deal table. An agent also helps refine your search, so first time buyers should interview as many agents as possible to get a well-rounded sense of how well they understand their search. Some brokers may have numerous deals under their belt, but buyers looking at a specific city or neighborhood should aim to hire an agent experienced with that slice of California. 

Plus, expert brokers help buyers source comparable estimates on properties in the area, attend open houses with them, and then quarterback the final negotiations before closing. Having an advocate focused on your needs provides peace of mind, allowing you to focus on selling your current home or other tasks. 

Be sure you get a commission rebate

Buyers enjoy looking for homes, but speed through choosing an agent and miss out on potential savings. Instead, first time home buyers in California should interview multiple agents and ask if they offer commission rebates. 

When a deal closes, a 6% commission fee based on the purchase price of the house is split between the buying and selling agents. Most buyer’s brokers keep the 3% as a fee for their services. Ask if any rebate offer by Buyer agent.

Get pre-approved for a mortgage

Many first time buyers fall in love with the process of shopping for a home, but put off the mortgage process and work with the first lender they meet to get their home loan. 

Before starting your search and getting your hopes up, interview several local and national mortgage lenders to get the lowest interest rate. Vetting several providers creates a benchmark of the interest rates available for 15-year and 30-years mortgages. The process informs buyers of how much they can afford to borrow and what they can expect their monthly mortgage payment will be. Plus, depending on your financial situation and price of the property, lenders will be able to determine if you are eligible for a VA loan or FHA mortgage program.

Lenders comb through your financial history, checking your credit score W-2s, tax returns, and proof of assets to weigh if they will finance your mortgage. Avoid bouncing and checks or accruing non-sufficient funds charges, as these set off red flags for underwriters. Opening lines of credit in the months before and through the homebuying process also puts buyers at a disadvantage. 

Once a buyer has a pre-approval letter, they know their spending limit and raise the value of their bid. Generally, sellers want to offload their property and not sit on the market, and a buyer with a pre-approval letter of credit can hasten the transaction process. 

Set up property alerts 

Once you’ve secured a pre-approval for a mortgage, it is time to scout the market to refine your search. Work and social life constrict creativity, which is why modern real estate firms created tools to ease the search process.

Weichert has tools to provides buyers with the Search alert to fine tune to their area of choice from MLS - listed properties

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