Are you a First-Time Homebuyer? Do you know where to start?
Buying a place to call home can be a challenge if you don’t know where to start. Many wonder if having a certain amount of savings is all they need, or maybe having the right job, or is it something else?
This post will help answer most questions and will be an excellent guide to follow if you are looking to buy your first home.
Step 1 Credit is a very important factor in our lives. Having established credit or a history is key to landing a good job, getting a good insurance policy, getting a low interest rate on a car loan, etc. Qualifying and obtaining a home mortgage is dependent on your credit report, current job and work history, savings and financial affordability.
Purchasing a home is one of the most important financial decisions you will make in your life. Because of this, it is important for you to know what is on your credit report. You are able to request a free credit report annually from all three of the major credit bureaus. Pull your credit and review it for accuracy. Keep in mind the credit score is an additional feature that is not included with the free annual report. Get your credit report and review it today! annualcreditreport.com
Step 2 Having a good savings will be very helpful being that there are various costs involved in a home purchase. These expenses are usually home inspections and appraisal fees, earnest money deposit, down payment, home owner’s insurance, property tax and closing costs; among other costs that will come up during the process. Having a good savings will also put you in a better financial position to negotiate the terms with the lender demonstrating your affordability for the home.
Step 3 Consider where you want to live. You may want to start driving by neighborhoods and communities at different times to see amenities, lifestyle, lighting, traffic, commute times, etc. Consider narrowing your options to areas that you would want to live in by researching online, with friends, family and coworkers. Begin your research with Better Homes and Gardens Real Estate.
Step 4 There are many down payment assistance programs and home buying seminars available to home buyers. Do your research locally to participate and prepare for purchasing your home.
Step 5 Get Pre-Approved by a lender. It is important that once you are ready to start the process, you begin by visiting your local bank or contacting a mortgage broker/loan officer. Be prepared to provide work history information, bank statements, pay stubs, income tax records, rental history, references, etc.
The sooner you visit a lender, the quicker you’ll know what you can afford and the steps you need to take to improve your credit or generate more income. Keep in mind there are different rules around licensing requirements for Mortgage Brokers/Loan Officers in each state. Do your research!
Step 6 Interview and hire a REALTOR®. This process should not be difficult. Google and search for the local REALTORS® in your area. Ask friends, coworkers, and family for recommendations. When your research is complete, choose one and hire them to represent you in the home purchase process.
Have questions or comments? Please let me know!