The time has come and you are ready to buy, but before you
start searching for your next home review this checklist. This list helps you
prepare your budget in advance and guide you to financial success in the
future.
1. Reduce Debt & Increase Credit
Score: Before you start looking
for your next home you should request a credit report. This will give you a
starting point on understanding your credit score before you request a loan.
Your credit score will influence the interest rate of your loan.
2. Save Money to Set
Yourself Up with a Large Down Payment: While it is possible to purchase a home without a 20% down
payment it’s best to get as close as possible. This will allow you to have a
smaller mortgage rate, Avoid PMI, and receive a better rate. If you do not have
a 20% down payment you may qualify for a VA or FHA loan.
3. Keep a Conservative
Budget: It’s just not the list
price that is included in the purchase. Keep in mind there are inspection fees,
earnest fees, moving expenses, and typically new furniture purchases that you
should prepare for in advance. Along with the initial moving expenses you
should also be aware of your monthly budget moving forward. With homeownership
comes property taxes, HOAs, home repairs, and more. You want to make sure you
are prepared for future budgeting as well.
4. Get Preapproved: Your preapproval can help if you are
putting in an offer against someone who is not...makes you look like a more
ready now buyer. Your preapproval is based on your actual income, debt, and
credit history. This is different from prequalification, which is how a lender
determines how much you can afford.
5. Set Your Home Buying
Budget: By getting your
finances in line before your first home showing you know the price range of a
home that you can actually afford. It is important to set a realistic budget
that fits your income level and characteristics you want in a home.
6. Find an Agent You
Trust: An agent will be able
to guide you along the way and educate you n the home buying process. Also,
keep in mind an agent usually is very well connected to the other professional
you will need before closing day.
As you begin the process to find your next home checking these items off your list will provide you with a more successful home buying experience. Our team is here to help you! Let us know the area and/or neighborhood you are looking to live along with your top needs our team of professionals will assist with finding your next home.
