First-time homebuyer? Here’s what you’ll need to know…

What are my financing options?

There are many different loan types and lenders to consider, and it’s worth your time to shop around and find the right loan for you. We’ve laid out a brief description of each to help you understand which option meets your long and short-term goals, so you can identify the best deal. Every loan consists of three main yet distinctive factors — rate, type, and size. Check out this brief overview:

Fixed Rate or Adjustable Rate:

All loans will fit into one of these two categories, but a hybrid option is also available. The “rate” in question is the interest paid on the life of the loan. It can either be “fixed” and never change or “adjustable,” wherein the rate changes yearly or after a set number of years (thus making it a hybrid).

Government-Insured or Conventional loan:

In addition to deciding between a fixed rate, adjustable rate or a combination of the two, you’ll also need to decide if you want your loan to be insured and guaranteed by the federal government or not. Of the government-insured options, there is the FHA, the VA, and the USDA. Each is tailored to meet specific needs and has different advantages.

Jumbo or Conforming loan:

These terms describe the size of your loan based on criteria set by Fannie Mae and Freddie Mac. Jumbo loans are considered a higher risk for lenders and often come with additional requirements.

Should I buy a used home or a new home?

Option 1: Build a personalized new home

If you’ve always thought that building a personalized home was out of reach, you’ll be happy to know that KB Home designs new homes for your life and priced for your budget. You can personalize from the ground up, from floor plan and exterior style to design choices — many at no additional cost. You can even select where you want to live in the community. Plus, our new homes are highly energy efficient to help save you money and built with modern materials not found in older homes. Finally, you’ll get a 10-year limited warranty on your new home, so rest assured, we’ve got you covered.

Option 2: Buy a used home

Although a fixer-upper might sound appealing, older homes can require extra work for maintenance and repairs. Even if a used home gives you the flexibility to move sooner, it may come with a significant host of possible issues: older building materials and appliances, greater risk of leaks and drafts, the inability to personalize your space, and an overall less energy-efficient home. Used homes will often cost less per square foot than a new home, but updating for energy efficiency or more modern features can become costly. It may be worth considering a new home to save yourself money and headaches down the line.

How should I prepare for my home search?

Before you start looking, create a list that prioritizes your must haves, nice-to-haves, neutral, and deal breakers. This way, you can easily streamline your criteria and compare your experiences at different communities. Of course, there’s also the potential for the list to evolve if your preferences shift. A few things to consider:

Living space:

Think about what space you’ll need now and in your future. It may be based on the next five or 10 years, or it may be based on your current phase of life. Are you newlyweds, starting a family, combining families or empty nesters? How big does your house need to be to accommodate the future? Do you prefer a one- or two-story floor plan?

Features:

Make a list of what your ideal home will offer you and your family. Do you need a two-car garage? A yard for the kids? A large modern kitchen for cooking and entertaining?

Energy efficiency:

Many first-time homebuyers don’t realize the effect higher utility bills will have on their monthly budget. Larger houses will take more energy, and older homes can too if they haven’t been updated. Our homes are designed to be ENERGY STAR® certified, meaning they meet certain energy-saving requirements that can help save you money. Make a list of any additional energy-efficient features you might want, including appliances, solar paneling or high-efficiency water heaters.

Schools:

Depending on your stage of life or future needs, this is a top priority for many families. Whether you’re working with an agent or searching online, school district zones are readily available. A quick online search may be worth it to compare public and private schools, as well as day care centers in your area.

Commute times & local transportation:

Do you drive to work, take a bus, participate in a rideshare program or ride the train? Your home’s accessibility to local freeways and other transportation options is essential because of its potential impact on your daily life.

Community & neighborhood:

There are many lifestyle elements to consider, so it’s important to determine the type of neighborhood and community you desire. Do you want on-site amenities, like pools, clubhouses, playgrounds and parks? How close do you want your local grocery store, post office, and medical centers? Shopping, dining, entertainment venues and outdoor recreation are also integral to the quality of daily life, so your home and neighborhood should accommodate the way you want to live.

You’re ready to start searching!

Now that you have lots of useful information to help set your priorities, move forward with confidence and find the home of your dreams!