The buying process for a first-time buyer can be daunting, confusing and stressful. The Bacorn Group believes that widespread home-ownership creates value for the community and security for families. We utilize our position in the industry to educate our clients and to empower them to make the best decisions in today's market. We want to make each step crystal clear for you - so you can focus on what is best for you. Our goal is to fully understand and faithfully serve your needs.

If you are currently renting, depending upon your situation, it may be a great time for you to consider purchasing. The average price of a 2-bedroom apartment per month to rent in Santa Cruz is over $2000. At this price, you would be spending at least $24,000 a year on a residence you do not own (this adds up to $480,000 after 20 years, provided your rent does not increase). If you have made the decision tobuild equity instead of paying out these costs, learning about the buying process is a great place to start (also see UCSC Housing Website for more statistics).

So, what's the first step? Please read on below or contact us at to learn more.

1. The Pre-Approval - Before you start looking for your first home, you want to know what you can afford. Assess your financial situation, and arrange to sit down with a reputable mortgage loan agent (please feel free to ask us if you need a recommendation). Obtaining this information for yourself will also help you determine what your monthly payments will be and the interest rate on the type of loan you would like. 

There are many different options when it comes to your down payment and types of loans. The idea of a 20% down payment can shut down the entire idea of purchasing a property for many buyers. While a larger down payment can make an offer more enticing to a seller and will also lower your monthly payments, it is not necessary. A down payment is not a required component of a purchase offer. In certain situations an offer with a 3-5% down payment can be competitive. Remember when looking at loans that many have down payment minimums. Conventional loans have a minimum that will change depending on the amount of the loan.

FHA loans are a great option for first-time buyers and have risen in popularity, insuring loans for as little as 3.5% down. This rise in popularity is mostly attributed to the leniency of qualifications to fund loans for buyers. It is common for the FHA to sign off on prior bad credit circumstances from the past few years in order to approve a loan. However, as a first-time home buyer, it is important to have cash saved and demonstrate that you are able and ready to take on a mortgage. You will not only need funds for a down payment, but for closing costs as well.

Please visit the links below to learn more about your loan options:

First Time Buyers

CALHFA (Learn about financing options & education course)

HUD California

Our recommendation is to meet with a reputable loan agent who will best be able to advise you depending which market you are intending to purchase in. Use a mortgage calculator to do a rough estimation on your own. 

2. The Parameters - You have Step 1 figured out. You are making smart decisions during this time, saving your money and avoiding large expenses. If you have a partner, you will need to determine together what you are looking for. In this case, we recommend writing down separately what your home wishlist is, and then writing one together afterward. Whether you are looking with a partner or by yourself, going to open houses will help you see what is going to be realistic for that area and for your price range. 

How many bedrooms do you require? How many bathrooms? Lot size? Extra features? Garage size? Which neighborhood? Assess your needs and lifestyle as you research homes and neighborhoods. Please see our Santa Cruz Co. City pages to learn more about different neighborhoods.

3. Find an agent - You can team up with an agent at any point in the process, but the sooner you talk to one, the more information you will have. An agent will be able to answer questions and show you listings you may not have access to. They will be able to help you determine what your parameters should be and help you through the pre-approval process.  They will also be able to advise you if you are on the fence or have a particular situation. And generally, these are all free services.

Many articles advise that you interview 3 agents. However, most real estate agents have their information available online so you can get a sense of their style and who they are and determine who is a good fit for you. Do some research, compare agents/brokerages and set up interviews with whoever you think will best be able to serve you. 

4. View Properties - Seeing homes in person and comparing different listings will really help you determine what is = realistic for the neighborhood you are looking in and your budget. Your agent can help walk you through this process, show you properties and of course, open houses are a great way to familiarize yourself with the market.

5. Write an Offer - Did you fall in love with a home? Is it a good fit for you and your needs? Talk to your agent, have them write an offer, sign on the dotted line and wait for a response. If your offer gets accepted, great! If not, look until you find the perfect fit.

From here, your agent will walk you through the rest of the process. Disclosures, escrow, inspections, etc., until finally, move-in day. Every transaction is different and your agent should take time to explain every step of the escrow process to you after getting into contract. See the below flow chart for an overview.


Please feel free to contact us at if you have any questions or are just looking for some guidance in buying your first home. 



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