Beginning the Path to Homeownership

Want to buy a home this year? There are things you can do now to put yourself in the best position possible. Here are some tips to help you get started!

START DOING YOUR RESEARCH
The more informed you are, the better! Even if you don’t have kids, schools are an important factor when buying a home. You may decide to have them in the future and often times the quality of schools in the area can help your home’s resale value.  Also take a look at the crime statistics, local community centers, and any special market requirements for the area you wish to purchase in. Your real estate agent can help with this.

KNOW WHAT YOU WANT… AND DON’T WANT
When you begin your search for the perfect home, there will inevitably be a time where you’ll have to compromise on something, so be ready for that. The compromise may come in the form of price, location, square footage, etc. Know and understand the items you are willing to compromise on and which items are deal breakers.

START SAVING AND KNOW YOUR BUDGET
There are many programs  for first-time homebuyers that allow for low down payments or even no money down.  It’s still a good idea to start saving in case you do need a down payment or to avoid PMI (Private Mortgage Insurance).  Most lenders want your mortgage payment (including any escrows for tax or insurance) to be no more than 28% of your monthly take home pay. You may want your monthly payment to be less, so determine in advance what you will be comfortable with.

CLEAN UP YOUR FINANCES
Take steps now to clean up your finances. Work on paying off any unpaid bills or other debts. If you have car loans, credit card debt, etc., start paying them down now. Check your credit score and be sure to fix any mistakes in your credit reports. You can also take steps now to improve your credit if it’s not where you want it to be. Check out our helpful tips to improve your credit score!

INTERVIEW AND FIND YOUR REAL ESTATE AGENT
It can take time to find the right agent to assist you in buying your home. Make sure your personalities match and your agent is committed to finding the right home for you – not someone just interested in another sale. It’s ok to meet with different agents who have a listing you want to see. Check with friends to get referrals and read customer testimonials on any agent you are considering working with.

GET YOUR ACCOUNTS IN ORDER
When you’re ready to apply for a mortgage, the lender will likely want to see your bank account statements and details of any payments that are not normal payroll amounts. Be ready to account for how you received any and all funds in your account. Most lenders will also want to see two years of tax returns. There are some alternative loans that don’t require tax records, but they may cost more in interest and are not offered everywhere.

CONSIDER OVERALL COST
Owning a home can come with some unforeseen costs. You may have HOA fees that allow for luxuries like a pool, gym or security. Or you may have to consider paying for your own lawn maintenance, tree trimmers, or trash removal – just to name a few. Your monthly payment isn’t just your mortgage payment, it is the total amount you pay including escrow accounts and day-to-day maintenance of your home. Another reason to start saving now.

When you’re ready to stop renting and own your own home, our expert mortgage professionals are here to make the process easy and help you every step of the way. Just fill out the form below to get started on your very own path to homeownership!