There are so many parts to buying a home, and it can get overwhelming pretty fast, particularly for first-time home buyers. The good news is that you’re not alone! Our team of mortgage specialists is ready to help you every step of the way.
Here’s a checklist of 6 things to do first.
You don’t have to follow the order of the list precisely. In fact, you may check off several at the same time when you apply for a home loan with us –making your first home purchase even easier! See how fast getting a home loan can be by applying online with us, and read on to see what else is on your “Home Buying To-Do List.”
1. Review Your Credit
In your eagerness to buy a home, you may think that the first step is to start looking at properties. However, we recommend that you look at your credit first. A low credit score affects your ability to qualify as well as partially determined the interest rate. So if you find any blemishes or mistakes on your credit report, you’ll want to correct those first.
You can get your free credit report from each of the three major credit-reporting bureaus, or you can have us pull it for you when you apply with us. We’ll review it with you and may make suggestions of ways that you can raise your score for an even better mortgage rate.
2. Create a Monthly Home Budget
Determine how much of a mortgage payment you can afford. It doesn’t have to be an exact number, but it can help you to see the big picture and gets you ready to budget for the responsibility of homeownership.
A mortgage payment is often more than rent. However, this is because there are taxes and insurance included in the monthly payment.
Don’t let a higher payment scare you! Remember that your mortgage payment is an investment in your property. Fannie Mae recommends spending a max of 28 percent of your income on your mortgage payment.
3. Gather Your Docs
Here’s the info you’ll want to have ready when you apply for your first home loan:
- Paycheck Stubs
- Current Bank Statements
- W-2’s Tax Returns for the Past Two Years
- Statements from Current Loans
- Contact Info of Your Landlords for the Past Two Years.
4. Get Pre-approved for a Mortgage
Pre-approval puts you in the best position when you’re house hunting. A pre-approval letter means that you have a lender that is ready to support your offer on a home –and, in many cases, it’s as good as cash!
Starting the process is easy and can be done entirely online!
Simply click on the “Apply Now” icon, and you’ll be taken to our secure online form. Upload your docs that you gathered from the previous step, and we’ll take care of the rest!
5. Start Home Shopping
This is the fun part –looking for your dream home! We have resources to help you with your search, or you can search independently with the help of your chosen realtor.
Whatever route you choose, know that our office is here to help if you have any questions about purchasing your first home.
6. Remember the Additional Costs
When creating your budget, you’ll also want to consider additional costs, like your down-payment, closing costs, as well as extra savings, should your home need repairs or appliances.
There are a few ways to try to lower these costs, such as asking the seller to pay for some or all of your closing, negotiating repairs, and asking the seller to include appliances with the sale of the house.
Another significant way to save money is with an FHA loan. Not only are the mortgage rates lower than most other home loans, but you can also get a house with as little as 3% down!
Buying your first home is easier than ever and current rates for first time homebuyers make it the best time to buy!