So, you've decided to take the plunge and buy your first home on Staten Island? Congratulations! Staten Island offers a variety of affordable houses, beautiful parks, plenty of shopping, great schools and easy access to Manhattan, Brooklyn and New Jersey, making it a great place to settle down and grow your roots.

But, as a first-time homebuyer, navigating the process can feel overwhelming. Here are the top 6 things to keep in mind:

1. Budget Like a Boss

Staten Island has many housing options. Still, in New York, housing prices tend to be higher than the national average. Be realistic about your budget. Look into the local real estate statistics. For instance; you may want to check out homes for sale in the Oakwood neighborhood if your budget is in the $650,000 - $700,000 range for a semi-attached home. Let’s say your budget is in the $700,000- $850,000 range, then you might consider the New Brighton neighborhood. It's not just the purchase price but also ongoing costs like property taxes, homeowners insurance, and maintenance that you must also consider. A good rule of thumb is to spend at most 25% of your gross monthly income on your mortgage payment.

2. Get Pre-Approved for a Mortgage

Before you start house hunting, get pre-approved for a mortgage. This pre-approval shows sellers you're a serious buyer and helps you understand how much you can afford and what price-range you can look at. The pre-approval process typically involves providing documentation of your income, assets, and liabilities to a lender. We have proudly joined forces with Think Mortgage to help our clients have an all-in-one experience. Think Mortgage will help you:

Get Pre-Approved
Determine your monthly mortgage budget
Generate a Free Credit Report and guide you to improve your credit score, if needed.
Work to resolve any issues that arise on your credit report
Help to determine the best type of mortgage (Conventional / FHA / VA)
Shop your mortgage with multiple lenders to ensure the lowest interest rate
Package all of your documents together and submit them to the bank
Work with the bank on your behalf to get your mortgage approved
Schedule and attend your closing.

Here's a breakdown of some standard home loans in NYC to help you choose the best fit:

Conventional Loan

Overview: Private lenders offer the most common loan type, not government-backed.
Qualifications: Requires a good credit score (typically 620 or higher), a minimum down payment (usually 3-20%), and a steady income.
Benefits: Often offers the best interest rates, especially for those with strong credit.
Drawbacks: Requires a larger down payment than some government-backed options.

Government-Insured Loans

Overview: Backed by the Federal Housing Administration (FHA) or the Department of Veterans Affairs (VA). These loans offer more relaxed credit score requirements and lower down payments.
Types:

FHA Loan: Ideal for first-time homebuyers with a lower credit score (could be as low as 500 with a 10% down payment). Requires private mortgage insurance (PMI) unless you reach 20% equity.
VA Loan: Exclusively for veterans, active-duty military personnel, and some surviving spouses. This option offers low or no down payment and no PMI.

Qualifications: The credit score requirements for VA loans are lower than those for conventional loans (FHA: min. of 500 with 10% down payment, VA: varies). However, there are specific eligibility requirements for VA loans based on military service.
Benefits: Lower down payment requirements and more flexible credit score options.
Drawbacks: FHA loans may have higher interest rates than conventional loans. They require PMI until reaching 20% equity. VA loans have funding limits and may involve specific property types.

Jumbo Loan

Overview: Designed for homes exceeding the conforming loan limit set by Fannie Mae and Freddie Mac.
Qualifications: Requires a strong credit score (typically 680 or higher), a significant down payment (often 20% or more), and proof of substantial assets.
Benefits: Allows financing for more expensive properties.
Drawbacks: Stricter requirements and potentially higher interest rates compared to conforming loans.

Choosing the Right Loan

The best loan for you depends on your individual circumstances. Consider your credit score, down payment savings, and the type of property you're interested in. It's wise to consult with a mortgage lender to discuss your options and get pre-approved for a loan. This will give you a clearer picture of your budget and strengthen your position as a buyer.

3. Find Your Real Estate Dream Team

An experienced real estate agent is your partner during the home-buying journey. They'll help you find homes that meet your criteria, negotiate the purchase price, and guide you through closing. Look for an agent familiar with the Staten Island market and with a strong reputation. At Robert DeFalco, we take pride in our company's top-notch services. Therefore, our agents consistently ask for client feedback, not only to demonstrate a job well done but to obtain knowledge on how to raise our standard of service to our clients to an even higher level consistent with what one should expect from Staten Island, Brooklyn, and New Jersey's #1 real estate firm.

4. Closing Costs: What You Need to Know

Closing costs are the fees associated with finalizing the purchase of your home. These can vary depending on location and purchase price but typically range from 2% to 5% of the purchase price. Be sure to factor these costs into your budget.

5. Inspections and Appraisals: Peace of Mind Before Signing

Before you close on a home, you'll need to have it inspected by a qualified professional. This home inspection will identify any major and/or minor repairs that may be necessary, and in most cases a termite inspection.

6. Don't Forget the Extras

Beyond the purchase price and closing costs, buying a home involves additional costs. These include moving expenses, homeowners insurance, and property taxes. Be sure to factor in these costs when budgeting for your new home.

Bonus Tip: First-Time Home Buyer Benefits!

First-time home buyers may have some incentives which might include down payment and closing cost assistance. Speak with your realtor or lender to see if you qualify.