Click here to join our weekly in-person and virtual educational workshops to secure your financial future.
Arrowroot Family Office
Search
  • Home
  • Services
    • Wealth Management Services
      • Investment Management
      • Individual Retirement Account (IRA)
      • 529 Plan
      • Corporate Retirement Plan
    • Financial Planning Services
      • Financial Planning
      • Retirement Planning
      • Estate Planning
      • Tax Planning
    • Multi Family Office Services
      • Accounting
      • Tax Efficiency
      • M&A Advisory
      • Wealth Strategy
      • Family Governance
      • Philanthropic Initiatives
    • form

      GUIDELINES TO FINANCIAL FREEDOM

  • Offices
    • Southern California
    • Northern California
    • Michigan
    • Virginia
  • About
  • Press
  • Contact
  • BOOK A CALL
BOOK A CALL
  • Home
  • Services
    • Wealth Management Services
      • Investment Management
      • Individual Retirement Account (IRA)
      • 529 Plan
      • Corporate Retirement Plan
    • Financial Planning Services
      • Financial Planning
      • Retirement Planning
      • Estate Planning
      • Tax Planning
    • Multi Family Office Services
      • Accounting
      • Tax Efficiency
      • M&A Advisory
      • Wealth Strategy
      • Family Governance
      • Philanthropic Initiatives
    • form

      GUIDELINES TO FINANCIAL FREEDOM

  • Offices
    • Southern California
    • Northern California
    • Michigan
    • Virginia
  • About
  • Press
  • Contact
  • BOOK A CALL
AFO2022-07-20T12:52:04+00:00

First Time Home Buyer

A first time home purchase is an exciting but daunting event for a lot of young people, luckily there are a lot of resources out there to use as a guide to a successful first time home purchase. The largest issue with these resources is… where to start?!?!

My wife and I just closed on our first home so I’d like to share some of the steps and pitfalls to watch out for when you are purchasing your first home! We started our process 4 years ago (I know that’s a long time ago) with a sit down meeting to review our finances, agree on and set goals for the next 5 years, and consolidate our assets into one place. This step I would advise meeting with a financial planner and walking through this process with them… trust me it is worth it. Our goal was simple: Set a savings rate so that we would have 20% to put down on our first home purchase in 5 years.

Table of Contents hide
  1. 1.) Pay off all Credit Card Balances and other manageable debts
  2. 2.) Save an emergency fund of 3 months living expenses
  3. 3.) Set a savings rate monthly to get to 20% down on the home.
  4. 4.) Once you are at about 15-18% saved, aim to get approved for a mortgage.
  5. 5.) At the same time you are getting approved for financing begin “Pre-Looking”.
  6. 6.) The last step is to turn the hunting switch on! You should have all your ducks in a row.

At the time it seemed like an impossible number with so many variables and life changes that could and did occur, but alas we broke it down into small chunks and it became more and more manageable. So what was our checklist for phase 1?

1.) Pay off all Credit Card Balances and other manageable debts

2.) Save an emergency fund of 3 months living expenses

(Things break in new homes, this is crucial to have so you avoid being house poor)

3.) Set a savings rate monthly to get to 20% down on the home.

This will help you avoid PMI and allow you to put more towards the principal each month. Don’t forget to include closing costs (5-10k). Many people will put less than 20% down on the home and justify it by saying “It’s less than I pay in rent!” but they fail to consider the additional expenses that come into play with home OWNERSHIP. The owner pays for upkeep, landscaping, maintenance, replacing appliances, blown water heaters etc etc. If you think all that plus PMI is cheaper than renting for a short time I’d like to sell you a bag of magic beans.

4.) Once you are at about 15-18% saved, aim to get approved for a mortgage.

Many dream homes are lost to financing falling through. Find a good local representative through your chamber of commerce that will take you through the process. The big lenders are fine, but often do not provide the service and education you will need for your first rodeo.

5.) At the same time you are getting approved for financing begin “Pre-Looking”.

This is where you stalk the real estate apps and sites and look for qualities you like in a home. You may even go to a few open houses or set up viewings so you and your partner can compile a checklist of must haves and wants for the home of your dreams. You may need to make sacrifices here and there, but you want to get 80% of your list. Currently there is a high rate of Buyer’s remorse amongst first time home buyers, reaching as high as 68% this past summer. Don’t be one of these remorseful purchasers and do your homework!

6.) The last step is to turn the hunting switch on! You should have all your ducks in a row.

Link up with a local realtor who knows the market well, make sure they have a Title person they use, and hunt away. This part takes even more patience. It took my wife and I 18 months to find our perfect starter home and our realtor told us that was quick! Find what will work for you and be ready to move on it quickly! Once you find your home get a property insurance quote and an inspection. Calculate cost of repairs and see if you can negotiate the seller to cover some of those costs. Often if you are purchasing later in the year the seller will be more flexible as most sellers do not want a property to sit all winter long.

First Time Home Buyer

Share this post

Facebook Twitter LinkedIn Email WhatsApp

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *


Related Posts

03MayMay 3, 2021

5 Key Points For Choosing The Right Wealth Management Firm

Every Wealth Management Firm you come across will be different from the next. What is important is choosing the one... read more

Everything to know about First-Time Homebuyer Credit
30MarMarch 30, 2023

Everything to know about First Time Homebuyer Credit

Everything to know about First-Time Homebuyer Credit Reviewed by: Dan Casey Dan Casey Vice President Vice President, Financial Planner, and Portfolio Manager... read more

Discover the Secrets of Financial Freedom​

Learn More

Services

Links

Newsletter

  • 4553 Glencoe Ave, Suite 201, Marina del Rey, CA 90292
    (310)566-5865
  • 2 Boars Head Ln, Suite 110, Charlottesville, VA 22903
    (626) 712-2090
  • 1264 Hawks Flight Ct Suite 290, El Dorado Hills, CA 95762
    (916) 384-0050
  • 725 Barclay Circle, Suite 125, Rochester Hills, MI 48307
    (248) 453-5252
  • Investment Management
  • 529 Plan
  • IRA
  • 403(b)
  • 401(k)
  • Corporate retirement
  • Retirement Planning
  • Tax Planning
  • Estate Planning
  • Financial Planning
  • M&A Mergers
  • Arrowroot Capital
  • Join Arrowroot
  • CPA Partnership
  • Press Releases
  • Careers
  • Events
  • Blogs
  • Clients Login
Arrowroot Family Office LLC is a registered investment adviser with the U.S. Securities and Exchange Commission (“SEC”). Registration with the SEC does not constitute an endorsement by the SEC, nor does it imply that AFO has attained a certain level of skill or ability. Content should not be construed as legal or tax advice, AFO is not engaged in the practice of law or accounting.

Form ADV Part 2.pdf

Form CRS .pdf

    Terms & Condition | Privacy Policy | Web Accessibility

Copyright © 2022 Arrowroot Family Office – All rights reserved.

Services

Links

  • 4553 Glencoe Ave, Suite 201, Marina del Rey, CA 90292
    (310)566-5865
  • 2 Boars Head Ln, Suite 110, Charlottesville, VA 22903
    (626) 712-2090
  • 1264 Hawks Flight Ct Suite 290, El Dorado Hills, CA 95762
    (916) 384-0050
  • 705 Barclay Circle, Suite 215, Rochester Hills, MI 48307
    (248) 453-5252
  • Investment Management
  • 529 Plan
  • IRA
  • 403(b)
  • 401(k)
  • Corporate retirement
  • Retirement Planning
  • Tax Planning
  • Estate Planning
  • Financial Planning
  • M&A Mergers
  • Arrowroot Capital
  • Join Arrowroot
  • CPA Partnership
  • Press Releases
  • Careers
  • Events
  • Blogs
  • Clients Login

Newsletter

Arrowroot Family Office LLC is a registered investment adviser with the U.S. Securities and Exchange Commission (“SEC”). Registration with the SEC does not constitute an endorsement by the SEC, nor does it imply that AFO has attained a certain level of skill or ability. Content should not be construed as legal or tax advice, AFO is not engaged in the practice of law or accounting.

Form ADV Part 2.pdf

Form CRS .pdf

    Terms & Condition | Privacy Policy | Web Accessibility

Copyright © 2022 Arrowroot Family Office – All rights reserved.

  • 4553 Glencoe Ave, Suite 201, Marina del Rey, CA 90292
    (310)566-5865
  • 2 Boars Head Ln, Suite 110, Charlottesville, VA 22903
    (626) 712-2090
  • 1264 Hawks Flight Ct Suite 290, El Dorado Hills, CA 95762
    (916) 384-0050
  • 705 Barclay Circle, Suite 215, Rochester Hills, MI 48307
    (248) 453-5252

Services

  • Investment Management
  • 529 Plan
  • IRA
  • 403(b)
  • 401(k)
  • Corporate retirement
  • Retirement Planning
  • Tax Planning
  • Estate Planning
  • Financial Planning

Links

  • M&A Mergers
  • Arrowroot Capital
  • Join Arrowroot
  • CPA Partnership
  • Press Releases
  • Careers
  • Events
  • Blogs
  • Clients Login

Newsletter

Arrowroot Family Office LLC is a registered investment adviser with the U.S. Securities and Exchange Commission (“SEC”). Registration with the SEC does not constitute an endorsement by the SEC, nor does it imply that AFO has attained a certain level of skill or ability. Content should not be construed as legal or tax advice, AFO is not engaged in the practice of law or accounting.

Form ADV Part 2.pdf

Form CRS

    Terms & Condition | Privacy Policy | Web Accessibility

Copyright © 2022 Arrowroot Family Office – All rights reserved.

Please note that you are exiting Arrowroot Family Office's website and entering one of a separate company. Arrowroot Family Office does not recommend or confirm any information on this site. Please read all disclosures on Arrowroot Family Office's website and that of the company's page you are about to enter. Continue Cancel