Dear Heather,

We are so excited. We are getting ready to start looking for our first home. Do you have any advice about what we should or shouldn’t be doing?

First-Time Buyer

Dear First-Time Buyer,

These are exciting times. You have finally outgrown apartment life or living with your parents or sharing a place with way too many roommates and you are ready to take the leap to home ownership. Now it is time to prepare. As you embark on this journey, beware of some important “don’ts” that could potentially derail your purchase.

Don’t think it’s too early to get pre-qualified

So, you are just going to go out looking at houses ... The time when you just expect to drive around a little and maybe visit an open house or two can be the time when you fall in love with a house and want to make a move on it right away.

If you are not pre-qualified with a lender, you may miss this opportunity. Competition for that “perfect starter cottage” can be fierce, as inventory is currently low. Well-maintained homes in a good central location do not sit long if they are priced right.

Talk to a lender now to make sure you can qualify and learn your maximum budget even if you just think you are casually looking because that can change unexpectedly.

Don’t ignore the closing costs

Many people focus on the down payment when getting ready to buy their first home, but there are other important expenses related to the purchase — the closing costs. Closing costs encompass a wide variety of fees, like stamp duty on the conveyance, legal fees on the conveyance, appraisal, stamp duties on the mortgage document and a finder’s fee by the bank for their services.

Add to that the cost of a structural survey if you choose to have one. Plus, there may be prorated taxes, insurance and rent, depending on the property.

You are looking at approximately five per cent of your purchase price for closing fees — which you should have available in cash. The bank will not cover these.

Some first-time buyers fail to factor this in when getting ready to purchase, and you don’t want something that could amount to thousands of dollars to come as an eleventh-hour surprise.

Don’t forget to factor in all the monthly expenses

Unlike renting or living with mom and dad, a home comes with responsibilities. You may not have worked things like a gardener into your monthly budget.

You will also want to consider that if you are going up in square footage, there will be an increase in your utilities and you will be taking on additional payments for things such as water, land tax, insurance, painting, maintenance and gardening that were previously covered by your rental.

It is best to have a true idea of what your monthly expenses are going to look like when buying your first home so that you do not end up in over your head.

Don’t think you can go it alone

You can really benefit by using an agent you trust to guide you through the transaction. An experienced agent will help navigate you through the process and keep things as smooth as possible for everyone involved.

• Heather Chilvers is among Coldwell Banker Bermuda Realty’s leading sales representatives. She has been working in real estate for nearly 30 years. Contact her at hchilvers@brcl.bm or 332-1793. All questions will be treated in confidence. Look for Ask Heather Real Estate on Facebook