Deciding to buy a home is a major life decision. Many people judge success by accomplishing this milestone. Not sure you ready to purchase a home? Keep reading.
1. Decide what you can afford. Generally, you can afford a home equal in value to between two and three times your gross income. Speaking with a mortgage lender is the first step. A lender will not only let you know how much you are approved for, but they will also provide an estimated "out the door" monthly costs that include taxes, insurance and monthly payment.
2. Develop your home wish list. Then, prioritize the features on your list. Focus on "nice to have" features and "need to have" features. If you are purchasing with another person, make
separate lists and then compare notes.
3. Select where you want to live. Compile a list of three or four neighborhoods you’d like to live in, taking into account items such as schools, recreational facilities, area expansion plans, and safety. The saying "location, location, location" is completely true. Staying true to your priorities can be tough when a prime location drives up the cost. A Realtor with intimate knowledge of the area you are interested in can help. Also a Realtor can suggest areas you may not even realize.
4. Get financially ready. Do you have enough money saved to qualify for a mortgage and cover your down payment? A mortgage lender will let you know exactly what you will need (another good reason to include them in the process early on). They will provide a "Good Faith Estimate" that will factor in closing costs.
5. Get your credit in order. Obtain a copy of your credit report to make sure it is accurate and to correct any errors immediately. A credit report provides a history of your credit, bad
debts, and any late payments.
6. Get pre-approved. Organize all the documentation a lender will need to pre-approve you for a loan. You might need W-2 forms, copies of at least one pay stub, account numbers, and copies of two to four months of bank or credit union statements.
7. Weigh other sources of help with a down payment. Do you qualify for any special mortgage or down payment assistance programs? Check with your state and local government on down payment assistance programs for first-time buyers. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal. I recommend speaking with a financial adviser to get a plan for success lined out. Buying a home can be a great investment. A professional can get you up to speed on the best way to leverage yourself.
8. Find the right Realtor. Find an experienced Realtor familiar with the local area who can help guide you through the process. A tech savvy Realtor is a must! Technology offers today's home buyer so many advantages.
1. Decide what you can afford. Generally, you can afford a home equal in value to between two and three times your gross income. Speaking with a mortgage lender is the first step. A lender will not only let you know how much you are approved for, but they will also provide an estimated "out the door" monthly costs that include taxes, insurance and monthly payment.
2. Develop your home wish list. Then, prioritize the features on your list. Focus on "nice to have" features and "need to have" features. If you are purchasing with another person, make
separate lists and then compare notes.
3. Select where you want to live. Compile a list of three or four neighborhoods you’d like to live in, taking into account items such as schools, recreational facilities, area expansion plans, and safety. The saying "location, location, location" is completely true. Staying true to your priorities can be tough when a prime location drives up the cost. A Realtor with intimate knowledge of the area you are interested in can help. Also a Realtor can suggest areas you may not even realize.
4. Get financially ready. Do you have enough money saved to qualify for a mortgage and cover your down payment? A mortgage lender will let you know exactly what you will need (another good reason to include them in the process early on). They will provide a "Good Faith Estimate" that will factor in closing costs.
5. Get your credit in order. Obtain a copy of your credit report to make sure it is accurate and to correct any errors immediately. A credit report provides a history of your credit, bad
debts, and any late payments.
6. Get pre-approved. Organize all the documentation a lender will need to pre-approve you for a loan. You might need W-2 forms, copies of at least one pay stub, account numbers, and copies of two to four months of bank or credit union statements.
7. Weigh other sources of help with a down payment. Do you qualify for any special mortgage or down payment assistance programs? Check with your state and local government on down payment assistance programs for first-time buyers. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal. I recommend speaking with a financial adviser to get a plan for success lined out. Buying a home can be a great investment. A professional can get you up to speed on the best way to leverage yourself.
8. Find the right Realtor. Find an experienced Realtor familiar with the local area who can help guide you through the process. A tech savvy Realtor is a must! Technology offers today's home buyer so many advantages.
