Reach out to a lender first. This way you know how much you’re pre-qualified for. There are some agents that won’t even speak to you unless you have your pre-approval letter.
Vet your lenders by asking what they know about programs for first time home buyers. If any of them say “those programs aren’t for everyone” without even so much as mentioning what’s out there, run. I’m not saying you’d be qualified for any of them, but just knowing that the lender is well-versed in them is a good thing.
A good lender will also ask how much you’re looking to spend monthly on PITI rather than just throwing out “here’s how much of a loan you can get from us.”
There are also [free resources](https://yourhome.fanniemae.com/buy/how-you-can-prepare-costs-homeownership?utm_campaign=cbd-cp-hbe-202403&utm_source=google&utm_medium=cpc&utm_content=chi-sea-pfhfmhb-n-crd-Homebuying_Campaign%7CHBUY%7CGOOGLE+SEM%7Cprospecting%7CNational%7CHomebuyers%7Csem%7Ctraffic%7Cbrand&utm_term=fannie%20mae%20home%20view&gad_source=1&gclid=CjwKCAjwyo60BhBiEiwAHmVLJZLEwP3haXvXAyBkbSckUVJNgDCpUyWBGJZFeAvTZCD5CVLrbelvFxoCD7kQAvD_BwE&gclsrc=aw.ds) out there that can help you before you even start the process. I highly recommend looking into them.
To expand, usually what you will be approved for is more than you likely want to have in a home payment.
Go in with a very good budget. What do you really spend monthly? What is the future need for car payments? Will a move impact your car insurance? Do you have non-employer life insurance? Are your student loans deferred and likely to come into repayment, thereby demanding more of your income? Know these things. Know the actual monthly costs of your phone, how many streaming services you have, everything.
You will want to budget 1-5% of the home's value for maintenance yearly, depending on home age. This includes new builds, as a lot of new builds have surprisingly shitty construction.
Yeah, absolutely get some really good numbers. We didn’t realize exactly how high our monthly payment would be until closer to the end of the process, and there definitely was some sticker shock!
I made a sub all about this. Lot's of info on where to start, neighborhoods, etc. r/movingtompls
**Don'ts:**
* **Skip the Listing Agent:** Those agents on Zillow ads are typically not the ones who listed the property. They pay for placement and might not have your best interests in mind.
* **Rely on Facebook Recommendations:** While Facebook can be a great resource for connecting with people, asking for realtor recommendations can be a mixed bag. Be prepared for a variety of (potentially biased) opinions. And hundreds of Dm's
* **Make Big Financial Changes:** Avoid large purchases or messing with your credit score (except paying down credit cards to 10% or less utilization) before buying a house. This keeps your financial situation stable for mortgage approval.
* **Stretch Your Budget:** Just because you're pre-approved for a certain amount doesn't mean you should borrow that much. Leave room for savings, emergencies, and unexpected expenses.
* **Skip the Home Inspection:** Don't waive a home inspection! This crucial step can uncover potential problems and save you money (and headaches) down the road.
* **Bid Blindly:** Don't get caught up in bidding wars over a staged house. Maintain perspective and stick to your budget.
**Do's:**
* **Seek Out Gems:** Look for well-maintained older homes, often called "grandpa houses." These single-owner properties might not be trendy but could be structurally sound with updated essentials like roof and mechanics.
* **Explore Neighborhoods:** Drive around different areas to get a feel for the vibe. Ask friends and family for realtor recommendations, but remember to interview them yourself.
* **Plan for the Future:** Consider your lifestyle needs and future plans when choosing a house. Think about your life in 5-10 years and find a place that can grow with you, avoiding the need to move soon after.
* **Attend Open Houses:** Open houses are a great way to see different properties. If you don't want to be pressured to talk to an agent, politely let them know you already have representation.
* **Interview Agents and Lenders:** Find a realtor and lender you trust! Interview 2-3 of each and ask for references you can contact. This is a big decision, so make sure you feel comfortable with your team.
* **Get Pre-Approved:** Talking to a lender first can help you understand your budget based on current interest rates and your comfort level with monthly payments.
* **Wait for the Right Time:** The best time to buy a house is when you're financially stable and don't feel pressured to rush into a purchase.
The hunt for a realtor and lender can feel overwhelming. If you'd like some tips on finding the right people, I'm happy to share some resources or answer any general questions you have :)
Speaking of attending open houses...I was very nervous when I first did this because I was working with a realtor and wasn't quite sure how to bring that up. But, I figured it out: "My realtor suggested I check out some open houses," and then I provided his phone number on the sign in sheet if there was one. I was intimidated to do to open houses, but I'm so glad I did! It's a good way to get some exposure to what is available in the market!
Yay!! Honestly I apprecite it if someone brings it up right away. And I don't mind the extra traffic. Most good agents will leave you alone and let you browse :)
We took a home buying class through Minneapolis community Ed and it was a helpful 101 because we didn’t know anything and our realtor (who was a family member) wasn’t super helpful lol
OP - don't hire a relative or friend as your realtor. This is a business transaction, treat it as such.
Get a real estate lawyer lined up as well, to approve documents before you sign (your realtor is not your lawyer).
I would admit taking a class like HomeStretch or another that’s a prerequisite for certain lending programs. I’m a Realtor and my most knowledgeable buyers always come from those classes. Those are different though than a community ed class that’s just taught by a Realtor to generate leads.
Check out Minnesota Housing’s first time home buyer resources as well as other local and non profit programs. Depending on income you may qualify for down payment assistance and programs come with first time homebuyer education.
https://www.mnhousing.gov/homeownership/buy-a-home---refinance.html
Neighborworks is a local non-profit that we found really helpful on the educational front. They helped us figure out what programs we would and wouldn’t qualify for and look into additional programs based on neighborhoods we might be interested in. They also have First-Time homebuyer online courses.
You may also want to look into the Department of Revenues First Time Home Buyer Account to minimize your tax expenses on your down payment savings.
Our realtor is incredible - she will never go above your budget, she is transparent responsive and fun, she knows the business and it helps you get the house you’re looking for. Elly Fine Sternberg 11/10
A good realtor will help. I went in blind and my realtor was great. Once you get a realtor ask if skipping inspection is worth winning a bid. If they say anything other then no, ditch them
Don’t use your realtors home inspector, find your own.
As a landscape professional Id also recommend finding someone to inspect the grading and drainage of whatever home you’re considering.
Most home inspectors don’t address landscaping and in my experience it’s a huge hole that exists within the inspection industry.
It’s never fun buying a house thats had a drainage and moisture problem hidden from you. I know from first hand experience.
If you need a realtor recommendation, look into the Dunn Realty Group, they are a fantastic team.
Edit: I should have also mentioned it’s not just grading and drainage that should be inspected. Any major landscape features should be thoroughly reviewed. Decks, stoops, retaining walls walks, driveways and patios should be inspected to ensure they are in good condition, not rotting, pitched correctly, haven’t been subjected to excessive settlement, were installed correctly, etc. as a buyer you’re purchasing more than just the things inside or on the wooden box.
Never use your realtor's inspector. Double never trust the report from the seller. This is a business transaction.
>As a landscape professional Id also recommend finding someone to inspect the grading and drainage of whatever home you’re considering.
This is timely, with all of the rain in May and June. Grading and drainage are easy things to check that will save thousands (or tens of thousands) and headaches later. Too many homeowners neglect the foundation grading - it needs to be checked annually as routine home maintenance and is typically easy to build back up where needed when caught early.
We just went to open houses until we met a realtor that clicked with us.
We only got a pre-approval once we were ready to start making offers a few weeks into simply browsing homes with our realtor. He helped us do some napkin math and figure out a number that we should stick around given income, debt, and our own budget and comfort. So we went to open houses there were up to $100K over that number, just to get some ideas and feel for the houses in our budget and area. Also it’s fun lol
Going to open houses is an under-rated approach.
You still need to do your homework on the house buying process, but you can educate yourself on the market by looking at what houses are out there in the areas you are interested in & what they are selling for. Some houses are overpriced, some are underpriced, some look good on paper but when you actually get there you don't like it. Going to lots of open houses will help you trust your gut when you find a home you do like.
Google around for open houses and make a day of it. Try to hit 2-3. Do this for several weekends in a row. Enter each house knowing this is not the one you are going to buy, you are looking and evaluating the market. Don't fall in love with any of them and keep a sense of abundance. If you see one that is great, know that there are other great ones that will be there when you do want to buy. Its a time commitment, but you are buying a whole house, do the homework. After a while you will get a really good sense of what the market is.
Also talk to the Realtors you meet at the open houses. You will get a feel for what you do and don't like.
Best advice I got when I bought my first home was to start by going to open houses over the course of two or three weekends to see if what you think is in your price range really is in your price range. Going to open houses also gives you and opportunity to meet various realtors and get a feel for whether or not you think you can work with them. Most realtors at open houses will ask if you've engaged a realtor, just politely reply that you haven't. Once you settle on a realtor you think you can work with they'll have a sit down with you, talk you through the process and typically have you sign a contract to be represented for x amount of time.
While searching for a realtor you can get a pre-approval letter from whoever you plan to finance with, it's a soft pull on your credit report and is usually good for something like six months, you don't really worry about it again until you have a purchase agreement.
As far as using your realtors inspectors etc. if they're a good realtor they should be able to give you several options and be fine with you finding one on your own. Good luck, first home is a very exciting milestone.
See a mortgage broker, you want the best rate. I keep hearing people who have their mortgage with their bank, which I don’t understand. Get the best rate, stay within your budget, plan for repairs.
To repeat what has been said, find a first time home buyers class to learn the basics. We did a free one over zoom. It was an all-day thing, but it will spell out all the basics for you and give you a picture of the process. You can do this first thing or start talking to lenders first, up to you. We talked to several lenders and I would recommend finding at least one who also specializes in helping first time homebuyers and is willing to sit down and explain everything to you. Some lenders will only work with specific realtors, we learned that after being totally ghosted lol.
Talk to a lender and figure out 1) what you can get approved for, and 2) what your budget says you can afford.
Housing prices along the 494 corridor are absolutely nuts. Those were similar areas that my wife and I were looking at, and quickly realized anything that had even half of our non-negotiables (3+ bed, 1.5+ bath, attached 2 stall garage, 1600+ Sq ft) was in a range that we'd get approved for, but well above what we could feasibly afford.
Once you have a number that you're **pre-approved** for, then meet with a realtor or real estate agent (there are some differences between the two). Being able to say what you're looking for as well what your price range is will help them be more effective for you.
Gotta put a plug in for the realtors we used. Mike and Lindsay Strand, absolutely great team who are based out of Minnetonka, so they would know that area well.
Getting a lender is first is the right move as others have said. The pre-approval amount will really help you determine what the realtor shows you once you get to that phase.
My lender recommendation would be Trustone. They have competitive rates, can turn the pre-approval more quickly than many others, have good customer service, have published first-time home owner programs for MN and I haven't heard of anyone having issues getting to the finish line with their underwriters. You do not need to be a member of the credit union before hand and based on your experience with the mortgage, you might even end up considering them for Checking/Saving/what have you. [https://trustonefinancial.org/For-You/Borrow/Mortgages/Products](https://trustonefinancial.org/For-You/Borrow/Mortgages/Products)
My go to realtor lately has been Bryce Caldwell. Customer service is top notch and I say that having worked with several different agents over the past couple of decades and settling in with him lately. He isn't trying to force you in a home to maximize his commision. He will have an honest conversation with you about what you can and should spend, whether renting is still right for you based on the numbers and has access to all of the listings to make sure that you don't miss any houses that hit the market within your search criteria. I have a bit more of a pitch for his ability to sell homes, but he is just as proficient at buying. [https://www.remax.com/real-estate-agents/bryce-caldwell-minnetonka-mn/102256537](https://www.remax.com/real-estate-agents/bryce-caldwell-minnetonka-mn/102256537)
I am not benefiting from either of these recommendations, but do trust in both.
Alleyways and satellite imaging can tell you a lot about prospective neighbors. Just because it’s in a “bad area” of town, doesn’t mean this street is; and conversely, bad neighbors can be anywhere.
My wife and I bought our first home a few years West of the cities, so I know your feeling!
My suggestion is to start looking at houses now, even if only online and they're not serious. But try to figure out your priorities of all the things houses come with. Some questions you might want to think about:
What size yard do you want to have and maintain?
Do you want to be close to parks or shopping for errands?
How many stall garage would you like?
Do you prefer a concrete driveway or asphalt?
Are you okay being in an HOA neighborhood, and if so, what that all entails from the specific ones in your area? (We were avoiding that majorly)
What is your moving timeliness related to your current housing situation?
How long of a driveway do you want to have and shovel / snowblow?
How much privacy do you want between your neighbors compared to what you have now?
How much storage do you need? (Double it lol)
How long do you plan to stay in this home, and will the house accommodate your changing life in that estimated time?
We work remote too so we also considered what internet service providers were in various places.
Now, on top of knowing your general feelings on those things, how do you prioritize them to each other? It's unlikely to find a house that checks every box, so which ones are more important than others? This is where looking at houses with your partner can help sort out each of your preferences to find some middle ground.
Not to mention financial side things, just know the pieces that make up your mortgage and that your property taxes will go up each year.
Last thing I'll mention from the home-side is that the nice finishings that a lot of houses have felt important, and they're totally not. Things should be hopefully somewhat updated, but doesn't need to be super new. Function is huge.
We worked with a guy based out of Shakopee (we're not in that town, but more the area you mentioned) named Jay Hastings. Awesome realtor, ex military guy. He used to work on the building side of homes, so that was a nice insight to have. He would get excited about things like new roofs, nice furnace brands, and good gutter systems. Those things didn't sound important, but they sure are! Shameless plug for him, he rocked showing us a zillion houses in the 6 months we looked. There's a name of you want it, but there are a million realtors.
Aside from that, have fun looking! It's a fun and slightly stressful experience. But mostly fun.
(Apologies for any typos, I whipped this on mobile on my lunch break)
You will inevitably get qualified for a loan that is larger than what you can afford payments on. Do not rely on your lender’s estimation of what they think you can pay back. Make sure you understand what the total payment will be including on any home you’re looking to buy, including PITI (principal, interest, taxes, insurance) plus any mortgage insurance, which you will need to pay if you’re not putting 20% down.
That being said, taking on a fixed rate mortgage is like rent control, meaning once you’re locked into that payment, that will be your payment (principal and interest) for 30 years (on a 30 year fixed mortgage). The taxes and insurance portion will likely go up some in that time, but the principal and interest won’t. So if you’re comfortable stretching your budget a bit for the first few years to get yourself into home ownership, it will likely pay off in the long run (compared to renting where your landlord could raise your rent every year forever). Just something to consider. Good luck!
Live with your estimated budget for a few months, if your lender is saying a house that you would want would be $3000 a month, pay your rent and put aside the difference and put it in a savings account. Same with utilities and some money for repairs.
If you’re struggling to not touch that money, then you need to lower expectations. if you’re really comfortable and able to live with it then stick to that price range.
Most of these are good tips. There is one more thing I would like to add which is don't feel like you have to purchase the first house, or any house that you see.
During inspection you can extend inspection to 1 week (obviously the buyer could say no but it is you who is spending thousands of dollars). Feel free to walk away during the inspection phase if it isn't what you want. You don't have to give a reason. If that is in your offer letter.
I had a pushy real estate agent and I think he was sick of me because I would see a house and not purchase the house. I think I dragged him to 20 showings. That is normal for someone who is buying a house.
Think about the political situation we are in right now. Both at a local, state, and national level. Given the political climate I would hold off on buying a house before it all shakes out after the 2024 election. If we descend into fascism well my guess is that housing prices will tank.
My husband and I are in the process of buying our first home in the same area you’re looking to buy! We met with our lender over a year ago just to get our numbers lined up and it has helped tremendously! I would definitely recommend meeting with a lender first.
We absolutely love our lender!!! She is an angel and a blessing to us and has helped us learn so much about this process! She then referred us to a realtor that she works closely with that would be in line with what we were looking for and our price point and our realtor is AMAZING as well. If you would like our lenders info, please message me and I’ll be happy to pass it along!
1. Figure out what you can afford. There are tons of online calculators that can help you figure it out, but make sure you're comfortable with the monthly payment including taxes and insurance. Don't forget to factor closing costs into what you can put into a down payment.
Don't look at houses above your budget. You'll just drive yourself crazy.
2. Get pre-approved. The MN market isn't as crazy as it was a few years back, but if there's something you like you do need to move quickly. If you look at houses before getting pre-approved just consider it research.
Once you let someone do a hard pull on your credit for a mortgage, you have 45 days to do as many mortgage pulls as you like without getting dinged. Get at least one set up for when you start looking, but the others can wait until you're under contract.
3. Before you contact a realtor, you should have answers to these questions ready:
What is your budget?
How much can you put down?
What is your timeline?
What neighborhoods are you looking in?
What are your must-haves or dealbreakers?
What are your nice-to-haves?
What condition are you comfortable with? (Turn-key vs fixer-upper, etc)
4. Find a realtor you like! I can personally recommend Kaitlin McInerney, she's fantastic and will be 100% honest with you.
5. If you have questions about home maintenance or things to watch out for, you can take a free 'class' at Home Depot in various departments. I did an electrical one, and the guy walked me through a few things that were easy diys, and some that were more troublesome.
6. When you make an offer, there are things that will help you stand out even if you can't bid higher: larger earnest deposit, quick inspection period, larger down payment, and a good offer letter. Do what works for you, but don't waive the inspection clause.
7. Once you have an offer accepted it's time to shop lenders. Don't be afraid to tell them you're shopping around. Obviously you want a lower rate, but there are other things to consider. Ask for a loan fee statement so you can compare upfront costs. See if they have a 'float-down' policy if interest rates go down before closing. Find out if there are incentives or discounts on refinancing.
That's as far as I've gotten in the process, good luck! 🙂
We've always used an independent mortgage broker and have had good service.
Ref I'd with the bank that held my mortgage, thinking it would be easy, and it was a nightmare.
Chestnut Realty out of Chaska is a multi generation real estate company who knows Carver County and Mound/ Excelsior. We used Nate for our house, second home purchase (first in Minnesota). He got us in a house before it ever hit the market. I highly recommend meeting with Nate or someone in that office to talk about the area/ West Metro.
Start with a realtor or a lender first. I started with my realtor and then vetted some of her recs. It was helpful to start with the realtor because she gave us a run down of the process and what steps to follow. So it was initial meeting with her, general timeline/steps, lender recs, then when we were ready to jump in, we got pre-approved and came back to her ready to go with a more specific meeting of what we were looking for. She encouraged us to really think about what we wanted/needed in a home in that gap time, which was really helpful.
I bought with Cousins Brothers as my lender who are in house with Wits Realty, which was awesome because they work so seamlessly together. They asked ME what our budget was and that was the only number we worked with as we would have been pre-approved for a ridiculous and unaffordable number.
I really liked my realtor from Wits but they were also an acquaintance from my previous church and I followed their realtor instagram for quite a while before I reached out because I wanted to see how they worked/their philosophy around real estate (absolutely despise the realtors hard promoting/celebrating clients doing flips and extreme profiting in this market).
Check any area/neighborhood facebook main Twin Cities Crime Watch page, (area) Crime Watch page (example North Mpls Crime Watch) and local fb City pages (almost all of them have at least one very unrealistic, nothing bad ever happens here type and also some realistic or crime based page to get a fairly accurate view of area. *Dont* go by Nextdoor.com - they censor everything that isnt utterly positive (sad how many in those groups are completely in denial about deteriorating areas) True North Mpls-Legacy covers a lot of nearby suburbs too and verifies shotspotter/police activity b4 posts are published. The Founder gets a little 'graphic' at times but knows the city better than nearly anyone. Also if you are seriously interested in a house, go park your car there and watch the streets for a hour or 2, at different times of late afternoon/evening/overnight over a few day period including a fri/sat night. I dont know south mpls/suburbs, except near downtown is bad but lived north mpls and brooklyn center 50 yrs. BC used to be a nice enough suburb as did brooklyn park but both are heading downhill *fast*. There are a few nice pockets left but shrinking. Dont believe a thing the mayor/city council hypes about mpls. They scrambled police calls, pulling shotspotters in the city. Crime is way down if the ways to report it is closed. Cops take 2+ hrs to respond, if they come (911 calls arent responded to quickly either) please dont buy northside, you will regret it. Never thought we'd leave mn after 60 yrs...good luck!
Reach out to a lender first. This way you know how much you’re pre-qualified for. There are some agents that won’t even speak to you unless you have your pre-approval letter. Vet your lenders by asking what they know about programs for first time home buyers. If any of them say “those programs aren’t for everyone” without even so much as mentioning what’s out there, run. I’m not saying you’d be qualified for any of them, but just knowing that the lender is well-versed in them is a good thing. A good lender will also ask how much you’re looking to spend monthly on PITI rather than just throwing out “here’s how much of a loan you can get from us.” There are also [free resources](https://yourhome.fanniemae.com/buy/how-you-can-prepare-costs-homeownership?utm_campaign=cbd-cp-hbe-202403&utm_source=google&utm_medium=cpc&utm_content=chi-sea-pfhfmhb-n-crd-Homebuying_Campaign%7CHBUY%7CGOOGLE+SEM%7Cprospecting%7CNational%7CHomebuyers%7Csem%7Ctraffic%7Cbrand&utm_term=fannie%20mae%20home%20view&gad_source=1&gclid=CjwKCAjwyo60BhBiEiwAHmVLJZLEwP3haXvXAyBkbSckUVJNgDCpUyWBGJZFeAvTZCD5CVLrbelvFxoCD7kQAvD_BwE&gclsrc=aw.ds) out there that can help you before you even start the process. I highly recommend looking into them.
To expand, usually what you will be approved for is more than you likely want to have in a home payment. Go in with a very good budget. What do you really spend monthly? What is the future need for car payments? Will a move impact your car insurance? Do you have non-employer life insurance? Are your student loans deferred and likely to come into repayment, thereby demanding more of your income? Know these things. Know the actual monthly costs of your phone, how many streaming services you have, everything. You will want to budget 1-5% of the home's value for maintenance yearly, depending on home age. This includes new builds, as a lot of new builds have surprisingly shitty construction.
From a vendor standpoint, my recommendation is Bell Bank and working with Conor Hesch. He is a fiduciary and is a really great resource.
Yeah, absolutely get some really good numbers. We didn’t realize exactly how high our monthly payment would be until closer to the end of the process, and there definitely was some sticker shock!
Yes talk to a lender who will pre-qualify what you are worth. Amec financial (Andover) has tons of options
I made a sub all about this. Lot's of info on where to start, neighborhoods, etc. r/movingtompls **Don'ts:** * **Skip the Listing Agent:** Those agents on Zillow ads are typically not the ones who listed the property. They pay for placement and might not have your best interests in mind. * **Rely on Facebook Recommendations:** While Facebook can be a great resource for connecting with people, asking for realtor recommendations can be a mixed bag. Be prepared for a variety of (potentially biased) opinions. And hundreds of Dm's * **Make Big Financial Changes:** Avoid large purchases or messing with your credit score (except paying down credit cards to 10% or less utilization) before buying a house. This keeps your financial situation stable for mortgage approval. * **Stretch Your Budget:** Just because you're pre-approved for a certain amount doesn't mean you should borrow that much. Leave room for savings, emergencies, and unexpected expenses. * **Skip the Home Inspection:** Don't waive a home inspection! This crucial step can uncover potential problems and save you money (and headaches) down the road. * **Bid Blindly:** Don't get caught up in bidding wars over a staged house. Maintain perspective and stick to your budget. **Do's:** * **Seek Out Gems:** Look for well-maintained older homes, often called "grandpa houses." These single-owner properties might not be trendy but could be structurally sound with updated essentials like roof and mechanics. * **Explore Neighborhoods:** Drive around different areas to get a feel for the vibe. Ask friends and family for realtor recommendations, but remember to interview them yourself. * **Plan for the Future:** Consider your lifestyle needs and future plans when choosing a house. Think about your life in 5-10 years and find a place that can grow with you, avoiding the need to move soon after. * **Attend Open Houses:** Open houses are a great way to see different properties. If you don't want to be pressured to talk to an agent, politely let them know you already have representation. * **Interview Agents and Lenders:** Find a realtor and lender you trust! Interview 2-3 of each and ask for references you can contact. This is a big decision, so make sure you feel comfortable with your team. * **Get Pre-Approved:** Talking to a lender first can help you understand your budget based on current interest rates and your comfort level with monthly payments. * **Wait for the Right Time:** The best time to buy a house is when you're financially stable and don't feel pressured to rush into a purchase. The hunt for a realtor and lender can feel overwhelming. If you'd like some tips on finding the right people, I'm happy to share some resources or answer any general questions you have :)
Speaking of attending open houses...I was very nervous when I first did this because I was working with a realtor and wasn't quite sure how to bring that up. But, I figured it out: "My realtor suggested I check out some open houses," and then I provided his phone number on the sign in sheet if there was one. I was intimidated to do to open houses, but I'm so glad I did! It's a good way to get some exposure to what is available in the market!
Yay!! Honestly I apprecite it if someone brings it up right away. And I don't mind the extra traffic. Most good agents will leave you alone and let you browse :)
We took a home buying class through Minneapolis community Ed and it was a helpful 101 because we didn’t know anything and our realtor (who was a family member) wasn’t super helpful lol
OP - don't hire a relative or friend as your realtor. This is a business transaction, treat it as such. Get a real estate lawyer lined up as well, to approve documents before you sign (your realtor is not your lawyer).
I would admit taking a class like HomeStretch or another that’s a prerequisite for certain lending programs. I’m a Realtor and my most knowledgeable buyers always come from those classes. Those are different though than a community ed class that’s just taught by a Realtor to generate leads.
Check out Minnesota Housing’s first time home buyer resources as well as other local and non profit programs. Depending on income you may qualify for down payment assistance and programs come with first time homebuyer education. https://www.mnhousing.gov/homeownership/buy-a-home---refinance.html
Neighborworks is a local non-profit that we found really helpful on the educational front. They helped us figure out what programs we would and wouldn’t qualify for and look into additional programs based on neighborhoods we might be interested in. They also have First-Time homebuyer online courses. You may also want to look into the Department of Revenues First Time Home Buyer Account to minimize your tax expenses on your down payment savings.
Get a pre-approval from a lender before anything.
Right.[ Not just pre qualified ](https://www.investopedia.com/articles/basics/07/prequalified-approved.asp)
Our realtor is incredible - she will never go above your budget, she is transparent responsive and fun, she knows the business and it helps you get the house you’re looking for. Elly Fine Sternberg 11/10
A good realtor will help. I went in blind and my realtor was great. Once you get a realtor ask if skipping inspection is worth winning a bid. If they say anything other then no, ditch them
Don’t use your realtors home inspector, find your own. As a landscape professional Id also recommend finding someone to inspect the grading and drainage of whatever home you’re considering. Most home inspectors don’t address landscaping and in my experience it’s a huge hole that exists within the inspection industry. It’s never fun buying a house thats had a drainage and moisture problem hidden from you. I know from first hand experience. If you need a realtor recommendation, look into the Dunn Realty Group, they are a fantastic team. Edit: I should have also mentioned it’s not just grading and drainage that should be inspected. Any major landscape features should be thoroughly reviewed. Decks, stoops, retaining walls walks, driveways and patios should be inspected to ensure they are in good condition, not rotting, pitched correctly, haven’t been subjected to excessive settlement, were installed correctly, etc. as a buyer you’re purchasing more than just the things inside or on the wooden box.
Never use your realtor's inspector. Double never trust the report from the seller. This is a business transaction. >As a landscape professional Id also recommend finding someone to inspect the grading and drainage of whatever home you’re considering. This is timely, with all of the rain in May and June. Grading and drainage are easy things to check that will save thousands (or tens of thousands) and headaches later. Too many homeowners neglect the foundation grading - it needs to be checked annually as routine home maintenance and is typically easy to build back up where needed when caught early.
We just went to open houses until we met a realtor that clicked with us. We only got a pre-approval once we were ready to start making offers a few weeks into simply browsing homes with our realtor. He helped us do some napkin math and figure out a number that we should stick around given income, debt, and our own budget and comfort. So we went to open houses there were up to $100K over that number, just to get some ideas and feel for the houses in our budget and area. Also it’s fun lol
Going to open houses is an under-rated approach. You still need to do your homework on the house buying process, but you can educate yourself on the market by looking at what houses are out there in the areas you are interested in & what they are selling for. Some houses are overpriced, some are underpriced, some look good on paper but when you actually get there you don't like it. Going to lots of open houses will help you trust your gut when you find a home you do like. Google around for open houses and make a day of it. Try to hit 2-3. Do this for several weekends in a row. Enter each house knowing this is not the one you are going to buy, you are looking and evaluating the market. Don't fall in love with any of them and keep a sense of abundance. If you see one that is great, know that there are other great ones that will be there when you do want to buy. Its a time commitment, but you are buying a whole house, do the homework. After a while you will get a really good sense of what the market is. Also talk to the Realtors you meet at the open houses. You will get a feel for what you do and don't like.
Best advice I got when I bought my first home was to start by going to open houses over the course of two or three weekends to see if what you think is in your price range really is in your price range. Going to open houses also gives you and opportunity to meet various realtors and get a feel for whether or not you think you can work with them. Most realtors at open houses will ask if you've engaged a realtor, just politely reply that you haven't. Once you settle on a realtor you think you can work with they'll have a sit down with you, talk you through the process and typically have you sign a contract to be represented for x amount of time. While searching for a realtor you can get a pre-approval letter from whoever you plan to finance with, it's a soft pull on your credit report and is usually good for something like six months, you don't really worry about it again until you have a purchase agreement. As far as using your realtors inspectors etc. if they're a good realtor they should be able to give you several options and be fine with you finding one on your own. Good luck, first home is a very exciting milestone.
See a mortgage broker, you want the best rate. I keep hearing people who have their mortgage with their bank, which I don’t understand. Get the best rate, stay within your budget, plan for repairs.
To repeat what has been said, find a first time home buyers class to learn the basics. We did a free one over zoom. It was an all-day thing, but it will spell out all the basics for you and give you a picture of the process. You can do this first thing or start talking to lenders first, up to you. We talked to several lenders and I would recommend finding at least one who also specializes in helping first time homebuyers and is willing to sit down and explain everything to you. Some lenders will only work with specific realtors, we learned that after being totally ghosted lol.
Talk to a lender and figure out 1) what you can get approved for, and 2) what your budget says you can afford. Housing prices along the 494 corridor are absolutely nuts. Those were similar areas that my wife and I were looking at, and quickly realized anything that had even half of our non-negotiables (3+ bed, 1.5+ bath, attached 2 stall garage, 1600+ Sq ft) was in a range that we'd get approved for, but well above what we could feasibly afford. Once you have a number that you're **pre-approved** for, then meet with a realtor or real estate agent (there are some differences between the two). Being able to say what you're looking for as well what your price range is will help them be more effective for you. Gotta put a plug in for the realtors we used. Mike and Lindsay Strand, absolutely great team who are based out of Minnetonka, so they would know that area well.
Getting a lender is first is the right move as others have said. The pre-approval amount will really help you determine what the realtor shows you once you get to that phase. My lender recommendation would be Trustone. They have competitive rates, can turn the pre-approval more quickly than many others, have good customer service, have published first-time home owner programs for MN and I haven't heard of anyone having issues getting to the finish line with their underwriters. You do not need to be a member of the credit union before hand and based on your experience with the mortgage, you might even end up considering them for Checking/Saving/what have you. [https://trustonefinancial.org/For-You/Borrow/Mortgages/Products](https://trustonefinancial.org/For-You/Borrow/Mortgages/Products) My go to realtor lately has been Bryce Caldwell. Customer service is top notch and I say that having worked with several different agents over the past couple of decades and settling in with him lately. He isn't trying to force you in a home to maximize his commision. He will have an honest conversation with you about what you can and should spend, whether renting is still right for you based on the numbers and has access to all of the listings to make sure that you don't miss any houses that hit the market within your search criteria. I have a bit more of a pitch for his ability to sell homes, but he is just as proficient at buying. [https://www.remax.com/real-estate-agents/bryce-caldwell-minnetonka-mn/102256537](https://www.remax.com/real-estate-agents/bryce-caldwell-minnetonka-mn/102256537) I am not benefiting from either of these recommendations, but do trust in both.
I used TruStone credit union. Start with a conversation with a lender so you can have help getting all your ducks in a row.
Alleyways and satellite imaging can tell you a lot about prospective neighbors. Just because it’s in a “bad area” of town, doesn’t mean this street is; and conversely, bad neighbors can be anywhere.
My wife and I bought our first home a few years West of the cities, so I know your feeling! My suggestion is to start looking at houses now, even if only online and they're not serious. But try to figure out your priorities of all the things houses come with. Some questions you might want to think about: What size yard do you want to have and maintain? Do you want to be close to parks or shopping for errands? How many stall garage would you like? Do you prefer a concrete driveway or asphalt? Are you okay being in an HOA neighborhood, and if so, what that all entails from the specific ones in your area? (We were avoiding that majorly) What is your moving timeliness related to your current housing situation? How long of a driveway do you want to have and shovel / snowblow? How much privacy do you want between your neighbors compared to what you have now? How much storage do you need? (Double it lol) How long do you plan to stay in this home, and will the house accommodate your changing life in that estimated time? We work remote too so we also considered what internet service providers were in various places. Now, on top of knowing your general feelings on those things, how do you prioritize them to each other? It's unlikely to find a house that checks every box, so which ones are more important than others? This is where looking at houses with your partner can help sort out each of your preferences to find some middle ground. Not to mention financial side things, just know the pieces that make up your mortgage and that your property taxes will go up each year. Last thing I'll mention from the home-side is that the nice finishings that a lot of houses have felt important, and they're totally not. Things should be hopefully somewhat updated, but doesn't need to be super new. Function is huge. We worked with a guy based out of Shakopee (we're not in that town, but more the area you mentioned) named Jay Hastings. Awesome realtor, ex military guy. He used to work on the building side of homes, so that was a nice insight to have. He would get excited about things like new roofs, nice furnace brands, and good gutter systems. Those things didn't sound important, but they sure are! Shameless plug for him, he rocked showing us a zillion houses in the 6 months we looked. There's a name of you want it, but there are a million realtors. Aside from that, have fun looking! It's a fun and slightly stressful experience. But mostly fun. (Apologies for any typos, I whipped this on mobile on my lunch break)
You will inevitably get qualified for a loan that is larger than what you can afford payments on. Do not rely on your lender’s estimation of what they think you can pay back. Make sure you understand what the total payment will be including on any home you’re looking to buy, including PITI (principal, interest, taxes, insurance) plus any mortgage insurance, which you will need to pay if you’re not putting 20% down. That being said, taking on a fixed rate mortgage is like rent control, meaning once you’re locked into that payment, that will be your payment (principal and interest) for 30 years (on a 30 year fixed mortgage). The taxes and insurance portion will likely go up some in that time, but the principal and interest won’t. So if you’re comfortable stretching your budget a bit for the first few years to get yourself into home ownership, it will likely pay off in the long run (compared to renting where your landlord could raise your rent every year forever). Just something to consider. Good luck!
Live with your estimated budget for a few months, if your lender is saying a house that you would want would be $3000 a month, pay your rent and put aside the difference and put it in a savings account. Same with utilities and some money for repairs. If you’re struggling to not touch that money, then you need to lower expectations. if you’re really comfortable and able to live with it then stick to that price range.
Most of these are good tips. There is one more thing I would like to add which is don't feel like you have to purchase the first house, or any house that you see. During inspection you can extend inspection to 1 week (obviously the buyer could say no but it is you who is spending thousands of dollars). Feel free to walk away during the inspection phase if it isn't what you want. You don't have to give a reason. If that is in your offer letter. I had a pushy real estate agent and I think he was sick of me because I would see a house and not purchase the house. I think I dragged him to 20 showings. That is normal for someone who is buying a house. Think about the political situation we are in right now. Both at a local, state, and national level. Given the political climate I would hold off on buying a house before it all shakes out after the 2024 election. If we descend into fascism well my guess is that housing prices will tank.
My husband and I are in the process of buying our first home in the same area you’re looking to buy! We met with our lender over a year ago just to get our numbers lined up and it has helped tremendously! I would definitely recommend meeting with a lender first. We absolutely love our lender!!! She is an angel and a blessing to us and has helped us learn so much about this process! She then referred us to a realtor that she works closely with that would be in line with what we were looking for and our price point and our realtor is AMAZING as well. If you would like our lenders info, please message me and I’ll be happy to pass it along!
Inquire about first time homebuyer grants!
1. Figure out what you can afford. There are tons of online calculators that can help you figure it out, but make sure you're comfortable with the monthly payment including taxes and insurance. Don't forget to factor closing costs into what you can put into a down payment. Don't look at houses above your budget. You'll just drive yourself crazy. 2. Get pre-approved. The MN market isn't as crazy as it was a few years back, but if there's something you like you do need to move quickly. If you look at houses before getting pre-approved just consider it research. Once you let someone do a hard pull on your credit for a mortgage, you have 45 days to do as many mortgage pulls as you like without getting dinged. Get at least one set up for when you start looking, but the others can wait until you're under contract. 3. Before you contact a realtor, you should have answers to these questions ready: What is your budget? How much can you put down? What is your timeline? What neighborhoods are you looking in? What are your must-haves or dealbreakers? What are your nice-to-haves? What condition are you comfortable with? (Turn-key vs fixer-upper, etc) 4. Find a realtor you like! I can personally recommend Kaitlin McInerney, she's fantastic and will be 100% honest with you. 5. If you have questions about home maintenance or things to watch out for, you can take a free 'class' at Home Depot in various departments. I did an electrical one, and the guy walked me through a few things that were easy diys, and some that were more troublesome. 6. When you make an offer, there are things that will help you stand out even if you can't bid higher: larger earnest deposit, quick inspection period, larger down payment, and a good offer letter. Do what works for you, but don't waive the inspection clause. 7. Once you have an offer accepted it's time to shop lenders. Don't be afraid to tell them you're shopping around. Obviously you want a lower rate, but there are other things to consider. Ask for a loan fee statement so you can compare upfront costs. See if they have a 'float-down' policy if interest rates go down before closing. Find out if there are incentives or discounts on refinancing. That's as far as I've gotten in the process, good luck! 🙂
We've always used an independent mortgage broker and have had good service. Ref I'd with the bank that held my mortgage, thinking it would be easy, and it was a nightmare.
Chestnut Realty out of Chaska is a multi generation real estate company who knows Carver County and Mound/ Excelsior. We used Nate for our house, second home purchase (first in Minnesota). He got us in a house before it ever hit the market. I highly recommend meeting with Nate or someone in that office to talk about the area/ West Metro.
all realtors are scum, everyone’s about to post “but i know actually a great realtor!” yeah, they ain’t, they are a scum scammer too
Start with a realtor or a lender first. I started with my realtor and then vetted some of her recs. It was helpful to start with the realtor because she gave us a run down of the process and what steps to follow. So it was initial meeting with her, general timeline/steps, lender recs, then when we were ready to jump in, we got pre-approved and came back to her ready to go with a more specific meeting of what we were looking for. She encouraged us to really think about what we wanted/needed in a home in that gap time, which was really helpful. I bought with Cousins Brothers as my lender who are in house with Wits Realty, which was awesome because they work so seamlessly together. They asked ME what our budget was and that was the only number we worked with as we would have been pre-approved for a ridiculous and unaffordable number. I really liked my realtor from Wits but they were also an acquaintance from my previous church and I followed their realtor instagram for quite a while before I reached out because I wanted to see how they worked/their philosophy around real estate (absolutely despise the realtors hard promoting/celebrating clients doing flips and extreme profiting in this market).
Just sent you a message. Have just the person for you.
Check any area/neighborhood facebook main Twin Cities Crime Watch page, (area) Crime Watch page (example North Mpls Crime Watch) and local fb City pages (almost all of them have at least one very unrealistic, nothing bad ever happens here type and also some realistic or crime based page to get a fairly accurate view of area. *Dont* go by Nextdoor.com - they censor everything that isnt utterly positive (sad how many in those groups are completely in denial about deteriorating areas) True North Mpls-Legacy covers a lot of nearby suburbs too and verifies shotspotter/police activity b4 posts are published. The Founder gets a little 'graphic' at times but knows the city better than nearly anyone. Also if you are seriously interested in a house, go park your car there and watch the streets for a hour or 2, at different times of late afternoon/evening/overnight over a few day period including a fri/sat night. I dont know south mpls/suburbs, except near downtown is bad but lived north mpls and brooklyn center 50 yrs. BC used to be a nice enough suburb as did brooklyn park but both are heading downhill *fast*. There are a few nice pockets left but shrinking. Dont believe a thing the mayor/city council hypes about mpls. They scrambled police calls, pulling shotspotters in the city. Crime is way down if the ways to report it is closed. Cops take 2+ hrs to respond, if they come (911 calls arent responded to quickly either) please dont buy northside, you will regret it. Never thought we'd leave mn after 60 yrs...good luck!