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    Smart Planning When Buying Your First Home


    Buying your first home can be challenging and a bit nerve racking. Should you grab the first house that you can afford, or is it better to wait it out until you find the house that your heart is really set on?  There is a slight learning curve if you hope to become a homeowner for the first time, but smart planning and research can make the process easier for you so you are not left in the dark.

    How is your credit?

    The first place to start is checking your credit score. Your credit score is one of the most important factors in qualifying for a mortgage loan. There are several places where you can get a free credit report. Be sure to check your credit report over for any mistakes, unpaid accounts or collection accounts. Repairing damaged credit can take time, so start this process at least six months to a year before you start home shopping.

    How much can you afford?

    You need to have a good idea of what is coming in and what is going out every month in your household budget. Tracking income and spending for a couple months will give you an idea of what you can comfortably afford for a mortgage payment.  A great tip is having an emergency fund to cover at least six months of mortgage payments, in the case of an emergency.

    How much do you have saved for a down payment?

    If you have been putting off buying your first home because you think you need a large down payment –  many lenders have first time home buyer programs that require little money down. There are also local grant programs that offer down payment assistance for a first-time home buyer. Before you throw in the towel, talk to an experienced mortgage professional who can provide you with more information regarding first time home buyer programs that are available for you.

    How much can you qualify for?

    This is a must before beginning your home search. Meet with an experienced mortgage professional to find out the different types of mortgage programs they offer and how you can qualify. Find out how much you can afford to borrow and get pre-approved. Lenders will consider how much debt you have, how long you have been at your current job, and your monthly income. Lenders typically want to see two recent pay stubs, the previous two years W-2s, tax returns, and the past two months of your bank statements.

    Find an Experienced Real Estate Agent

    An experienced real estate professional can help you find properties in your price range and market area. The process can be difficult, and you will be glad to have a professional by your side to guide you through making an offer, negotiating the price, and working through the inspection. Find an agent who you like and who knows the market area well.

    House Hunting

    As you start looking at homes with your real estate agent, there are a few questions you should ask yourself:  Where do you want to live? What style of home? An old home or a new one? Move-in ready or a fixer-upper? As you educate yourself on the market, your agent will help you narrow down your preferences and help you make an informed decision about your final choices.

    Make an Offer

    You have found the perfect home, so now it is time to submit an offer. This is another area where your real estate agent is invaluable in negotiating for you. Your agent will help you decide what you will offer for the home. The offer will include conditions necessary for the sale. These are items that must be satisfied within a set time frame for the sale to go through.

    Following these tips and planning ahead can make the process of buying your first home go much more smoothly.  Good luck and happy house hunting!

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