By Lettecha Johnson

First-home buyers are trying to acquire what will likely be their largest asset. To ensure the process goes as smoothly as possible, potential homeowners should check their credit and save as much money as possible, while considering other costs such as unexpected repairs. The planning should also involve pre-approval and gathering a team of other experts, such as an experienced real estate agent and, in some cases, a real estate lawyer.

The National Association of Realtors reported in 2025 that the share of first-time homebuyers dropped to a record low of 21%, but the typical age climbed to an all-time high of 40 years old. People buying a home for the first time now have to deal with more expensive inventory that has made purchases harder to afford, but don’t give up, as middle-aged people are getting their first taste of ownership. 

Use proper preparation to avoid pitfalls that can make owning a house harder than it needs to be.

What Should First-home Buyers Know About Finances?

Don’t underestimate the value of having good credit. Start checking your credit report as early as possible and review it for anything that’s dragging your score down. If something looks suspicious or should have fallen off the report by now, don’t hesitate to contact the appropriate credit bureau for correction. 

The higher your credit score is, the better the interest rates you can get for a mortgage. It can make a difference in interest rates as low as 3% or as high 7%, which adds to your monthly payment. 

Speaking of payment, you’ll need a down payment, and the more you can pay upfront, the less your mortgage financing will need to be. While some conventional loans may allow as little as 3% down and veteran loans may require 0%, the more you have available creates less of a financial headache. 

You also have to prepare for closing costs, which can be as much as 5% of the loan amount. Once you move into your home, even if it’s a new one, you may have unexpected repairs or look around and decide you want to renovate something. Some experts recommend setting aside $200-$300 per month after moving in to cover these costs.

What Other Home Buying Tips Can Prevent Problems?

Get serious about buying your first home, and gather a professional team who can help you. Look for an experienced real estate agent who specializes in your area. Find a trusted mortgage lender to avoid the trouble of an unscrupulous mortgage, as what caused the financial crisis of 2009.

Do I Need an Attorney?

A real estate lawyer may be worth investing in, depending on the type of home you’re buying. 

Consider a real estate attorney if your first-time home purchase involves:

  • Title disputes
  • Distressed property, such as foreclosures
  • For sale by owner
  • Co-purchases with friends or family

Some states also have laws that require the presence of an attorney to conduct your closing and handle related settlement.

Should I Check the Area Out?

Your home goes beyond the confines of your house, as your overall neighborhood and community also matter. That’s why, before making this purchase, you should feel comfortable that this is an area that you want to live in, especially if you have children. 

Check out the area at different times of day and test what your commute might be during rush hour. Research what other businesses are in the area, from local coffee shops to libraries and hospitals. Try to see what people in the area think about living there, which may be easier to do if you’re patronizing a local business.

What First-time Buyer Assistance Is Available?

First-home buyers have resources available from the state and local levels. There are national programs such as FHA and VA loans. If you’re abroad, you can explore no deposit home loans in Australia.

You can get USDA loans that don’t require any down payment if the property is located in a designated rural or suburban area. An FHA loan requires a minimum credit score of 580 and a down payment of about 3.5%. 

Veteran loans come with no down payment and additional benefits like a lower interest rate. It’s available to active duty veterans as well as their surviving spouses.

Frequently Asked Questions

What Is the 2 2 2 Rule for Mortgages?

This mortgage lending rule is a credit guide used by underwriters to verify that a potential borrower has a stable debt history. It requires that the borrower have at least two active credit accounts that have been open for at least two years. There should also be a documented history of two consecutive years of on-time payments.

These two credit accounts can be revolving credit, like credit cards, or installment loans that include student or auto financing. A helpful way to meet this rule for buying a home is to keep your accounts open and don’t rush to close your old paid off credit cards. Try to avoid adding unnecessary new debt before applying for a mortgage, as it will affect your credit score.

What Not to Tell a Mortgage Lender?

One thing you shouldn’t do during mortgage processes is lie on your application, as that’s illegal. When you sign a mortgage document, it’s a legally binding contract that you’re responsible for. However, experts also suggest avoiding volunteering any unrequested negative information, such as minor credit struggles in the past.

Avoid talking about your new credit card or car purchase. Don’t mention things like forgetting to pay bills, as consistency is key, especially when it comes to home management.

Get Ready for Your First Home

First-home buyers have a lot of work to do when making a first home purchase. Owning a new home is an exciting time, and you can do so despite roadblocks like more expensive housing or raising interest rates. 

Doing your due diligence ahead of time, from getting your credit order to increasing your savings and having an experienced team, can put you into your dream home sooner rather than later. 

If you want more real estate advice, check out other articles on our website.