As a real estate agent, you have the opportunity to assist people in owning their very first home. Help them make wise decisions by sharing this first-time buyer advice.
You’ve probably already told them they need to get pre-approved for their home mortgage loan. Especially in 
today’s hot market, a buyer who isn’t pre-approved doesn’t stand much chance of getting an offer accepted.
Unfortunately, lenders can only advise based on the information they have. They don’t know about the borrower’s lifestyle and what is important to them regarding the dollars they spend over and above their monthly obligations.
So the first bit of first-time buyer advice is to look at their own spending and see how many dollars need to be set aside for things like dining out, concerts, summer camp for the kids, music lessons, and even annual vacations.
If their home mortgage payments will be more than their current rent…
The second bit of first-time buyer advice is equally important. Advise them to factor in the new mortgage payment, plus an amount to set aside monthly for maintenance and repairs, then create a budget and live within that budget for 3 months.
The rule of thumb to reserve for maintenance and repair is 1% of the purchase price per year. Thus, if they purchase a home for $250,000, they should set aside $2,500 per year, or $208.33 per month.
Can they live within that new budget comfortably, or will the price they think they want to pay for a home force them to forgo other pleasures in their lives?
I know, they (and you) are in a hurry and probably don’t want to wait to find that house. But knowing how that payment will affect their lives over the next few years is important. It’s one thing to save and do without little luxuries for a few months while saving for a down payment, but to do it year in and year out is not a pleasant prospect.
This first-time buyer advice may lower your immediate income.
However, the good will you’ll generate will reap rewards. You’ll be known as the agent who does not encourage your first time buyers to make a life-changing financial mistake.
Your reputation as someone to trust will grow – and your referral base will grow with it.
Do you have first-time buyers registering on your website?
Hang on to them with my Nurturing Internet Buyer Leads letters.
