Tips: AVOID THESE MISTAKES
Time is of the essence!
Having a strong financial backbone is key when you begin the home-buying process. Allowing yourself a minimum of 6 months to prepare is not a shy estimate. If you have large amounts of debt to pay off such as car payments, school loans, or credit cards make it a goal to have a large percentage paid off.
Get Pre-Approved
Consult with a broker to find out what your loan amount should be and research a monthly mortgage payment you can afford. While doing this, choose someone you can trust and feel comfortable with. You will actively be in contact with one another for an extended period of time. The lender will discuss your financial history, pull a credit report, and put you in the forefront to hopefully become pre-approved. Know what you can reasonably afford so you are in contact with the right seller and looking at homes at your budget.
Know what you can afford
Know what you can afford in mortgage payments. Understand your limitations by creating a budget for your expenses and analyze your disposable income. Understand what you can afford and what all your necessary expenses will amount to. Including student loans, car payments, credit cards, food, insurance, etc. What amount of income will you have left for savings or investments? Think long-term about what your income will allow or limit you to. Utilize a mortgage company to further research your possibilities. After finding what style, area, and even square footage house you can comfortably live in. Be excited about the houses that can be your first buy because there is always a great home for every person/family.
Fixing Minor Problems
As a first-time home buyer, It is not always reasonable to choose a complete move-in ready home. Find a house that hasn’t reached its greatest potential so you can create value out of equity. Rather than pay an enormous price for a brand new home choose to fix minor problems in a budget-friendly house by creating a home with your own personal touch. Make the home the quality you wish
You’re approved and documents are needed!
This is where the fun begins and your organization skills are put to the test. This is where documentation will be asked of you. To begin you will be asked to provide forms of identification (driver's licenses, social security cards), tax returns, and bank statements just to name a few. Most importantly, keep copies for your records of the forms you signed, and touch basis with the realtor, title company, and lender to make sure everyone has what is needed as the mortgage process moves along.
Closing Time
First and foremost, do be aware that closing costs could be incurred and this is separate from the first down payment and does vary by where you live. From a loan processor's perspective, getting ready to close is a period of craziness for us (the mortgage broker), the lender, the title company, and the realtor exchanging in a communication frenzy. As a borrower be ready to proceed quickly as a closing date and time are set, remain patient and in contact with everyone, but most importantly be EXCITED & PROUD. You made it through your first home-buying experience!
