What You Should Know Before Purchasing Your First House
Now that you are ready to purchase your first house, you can’t wait to start looking at listings, attending open houses, and finding your dream home. Yet, before you sign on the dotted line of a contract, it’s best to know which steps to take during the home buying process. If you want everything to go smoothly from start to finish, follow these recommendations you should know before purchasing your first house.
Strengthen Your Credit
When you apply for a mortgage loan, your lender will take your credit history and score into consideration as part of your overall financial picture. Therefore, you should do all you can to strengthen your credit prior to your home purchase. To do so, you can pay your bills on time, keep your credit card balances as low as possible, and get free copies of your credit report to find and correct any errors they may contain.
Decide What You Can Afford
If there is one thing you don’t want to see occur during your home buying process, it is to find a home you love, make an offer on it, and then discover you can’t afford it after all. Rather than make this embarrassing and possibly costly mistake, sit down early on and decide how much “house” you can afford. For example, if you are interested in luxury homes, take into consideration not only your current income and amount of debt, but also how much of a down payment you will need, closing costs, and move-in expenses needed for repairs or other situations.
Shop Around for a Mortgage
While you can pursue a conventional loan from a bank, shopping around may get you a better deal. Once you do, you will realize there are many options available to homebuyers. For example, if you land an FHA loan, your down payment may be less than four percent of the home’s asking price. If you are a veteran, VA loans may also be available to you, and often require no down payment to buy a house.
Get a Great Real Estate Agent
If you think you won’t have any trouble finding the perfect house, negotiating a price, and handling all the details along the way, think again. Once you ponder this, you’ll realize that hiring a great real estate agent who has experience will benefit you in many ways. Along with knowing the local market and how to negotiate the best deal for their clients, your agent can also help with the closing process and advise you, should any problems arise.
In conclusion, by choosing to follow these steps as you look for your first house, you’ll avoid a lot of potential problems by staying on track and knowing what you’re looking for. With enough work and research, you will win on a house, move in, and find yourself loving your first home.