Hawaii Elite Real Estate is committed to helping you understand and guiding you through every step of the home buying process.
There are four main steps to buying a home, whether you are a first time home buyer on Maui, Hawaii, or not. Of course, the first step involves finding the right home for you based on needs, location and budget.
The next step is to secure financing for the home, so you know ahead of time what you are qualified to purchase. Once financing is in place, the next step is to make an offer on the property you wish to purchase. If the offer is accepted, you will then need to get an inspection for the property and close the deal.
If you are a first time home buyer, there are several advantages you can benefit from.
According to the U.S. Department of Housing and Urban Development (HUD), a first time home buyer is anyone who meets any of these conditions:
An individual who has not owned a principal residence for three years.
If you’ve owned a home but your spouse has not, then you can purchase a place together as first-time home buyers.
A single parent who has only owned a home with a former spouse while married.
A displaced homemaker who has only owned with a spouse. An individual who has only owned a principal residence not permanently affixed to a permanent foundation in accordance with applicable regulations.
An individual who has only owned a property that was not in compliance with state, local, or model building codes—and that cannot be brought into compliance for less than the cost of constructing a permanent structure.
Financial Preparation is Key
Before you begin the home buying process, it is best to do a financial self-audit first. This will help you determine your odds of qualifying for financing. Unless you are able to pay cash for the property of your dreams, you will need to be approved for a mortgage.
Following are a few tips to consider. They can help you determine if you are likely to be approved for a mortgage.
Looking at how much you have saved over the years is a great place to start. It is advisable before you begin home shopping to have a solid three to six months of living expenses saved up.
You will need to have a down payment, inspection fees and related closing costs on hand to purchase a home. The lending institution will be looking for these. Other financials you will want to review are your spending habits and your credit.
Lenders generally want to see your debt to income ratio at about 43%. One other step may wish to take before embarking on your home buying odyssey would be to get pre-approved for a mortgage.
This means you approach a lender, disclose financial information and have one of their underwriters determine how large of a loan you will qualify for. This way you will not waste your time finding a dream home and only discovering you do not qualify for a mortgage on that property.
Start Your First Time Home Buyer Maui Search
Now you are ready to begin looking around! Your Hawaii Elite Real Estate team is here to help you find neighborhoods and locate properties. We focus on those within your budget and having the amenities you desire.
If there are specific neighborhoods you like, by all means drive through them to see what’s available!
The best resource today is the internet. Our own website is a fantastic portal to browse hundreds of listings.
Locating a property that interests you is the first step. You will want to see the property in person, or virtually if your health or travel concerns make physical walk throughs undesirable or impractical.
The next step will be to secure financing for the property. If you are not planning to pay cash or if you have not already been pre-approved for a mortgage. In addition to traditional lending institutions, some states offer home buying programs providing assistance with down payments and closing costs.
You Can Use Retirement Funds for Your First Time Home Buyer Maui Experience
Also, you can withdraw up to ten thousand dollars from your IRA for use as a down payment. After financing has been approved, you can then make an offer on the property. This is usually done below the asking price and begins a process of negotiation between you and the seller.
Fortunately, when a first time home buyer on Maui, Hawaii, is working with a good real estate agent, they will negotiate on your behalf. The intimate knowledge a Realtor has of their market allows them to show the seller the advantages of accepting your offer.
When the offer is accepted, the down payment, title and all related monies and documents go into what is called Escrow. They will remain there until you complete a home inspection and whatever other requirements the seller and lender may have. Finally, the day arrives when you have completed the inspection and met all the requirements of the lender and seller.
You and your agent will attend a Closing, where you will hand over a bank check from your lending institution. This goes to the seller, who will then hand over the keys to your new home!
Congratulations! You are now a certified home owner!
Contact Hawaii Elite Real Estate at 808-866-6593 today. We are here to not only help you find that home of your dreams, but to seamlessly guide you through the buyer’s process.
Our market is full of amazing properties, just waiting for you to view!