If your like the majority of home buyers, you’re probably going to choose to finance your home with a mortgage loan. But waiting until your ready to move to start preparing financially is a never good idea, especially if you’re a first time buyer. Avoid the road blocks and delays that many home buyers face by preparing and staying ahead of the curve with three simple steps we’ve outlined below.
1. Check your credit score and keep it as high as possible
Your credit score is the first thing your lender will look at when trying to determine if they will approve you for your loan. Review and check your score regularly to make sure no fraudulent or suspicious activity has occurred with your accounts.
Most lenders will not approve you if your score is below 620, so if you know ahead of time what your score is and that you need to raise it, you can take the proper steps to do so.
If you’re looking to raise your score, consider the following:
- Make all payments on time
- Don’t apply for any unnecessary credit cards
- Pay down credit cards as quickly as possible and pay more than the monthly minimum requirement
2. Start saving early
Your down payment is a major factor in your home buying experience. How much you put down can determine how much you’ll save on interest and fees in the long run. If you’re able to put down a larger down payment, your monthly interest rate may be lower, so if you have the time to save, do it!
It’s also important to keep in mind closing costs and other fees that are associated with purchasing a home. From loan origination fees to appraisal fees, be sure to discuss all costs with your lender before closing to ensure you’re not blindsided by anything.
3. Determine if you’re ready to buy
Once you’ve got your credit score where you want it to be and you’ve saved up for a down payment, it’s time to determine what home is in your price range. Be reasonable about what you can afford and stay modest with your budget. Unexpected costs in the form of home repairs or moving expenses can creep up after you purchase your home, so having a cushion is important.
If you’re having trouble determining what you can and cannot afford with your current buying power, it’s best to consult a professional real estate agent who can walk you through the process.
If you’re currently looking to purchase a home and unsure of your options or simply have any questions, we’re happy to help. Please contact us today at 919-295-9298 or send us an email at: [email protected]
We’re here to help!