Emotionally and financially, buying your very first home is a major milestone. For many people, this is a huge dream, but not something near a reality. Why is it not a reality for most people? It is not a reality for most people with this dream because they will not do the work to make this a reality. Doing the work means taking care of your financial situation. It means being responsible and doing all of these things that can set a person up to purchase their first home.
Protect and Improve Your Credit
Credit is king when it comes to buying a home. To get into the first door of your home, to get the pretty sliding glass back doors, and even some fashionable barn doors that are so popular, it will take a few steps. Without good credit, you will be in a tough spot. There are home loans for average credit, but the worst your credit is, the higher your interest rate, the higher your down payment, and the more difficult it will be to pass underwriting to qualify for a home loan.
Taking care of your credit is the most important thing. What to do if you have bad credit? Is everything lost? Are you without hope? You are not hopeless because you can always improve your credit, work out deals, and educate yourself on how credit can be improved.
Income and Knowing What You Can Afford
How much house can you really afford? How much money do you make? What is your employment history? Do you have a strong banking history and work history? All of these things are needed when you want to buy a house. The underwriting process will look into all of these things, including your credit, to determine your borrowing worthiness. Do you have to be perfect? You do not need to be perfect, but you do need the history of someone who is financially responsible enough to qualify for a home loan.
Money Talks: Get Your Deposit Ready
Money talks more than anything else, good credit or bad credit. When you have a 10% to 20% deposit for a home, you have more options than if you did not have a deposit. This means your income needs to be strong, that you know how to save money, and more importantly, that you are ready to be a homeowner. A down payment is one of the most important things that can put you into a position to purchase a home.
Where Do You Want to Live?
Have you thought about where you want to live? Do you have an ideal first home? Is it in your price range? Can you qualify for the loan to get that home? Are you ready to push that button and get started? Have you looked around at properties? Do you truly know where you stand? These are all important questions when it comes to getting your first home. Know what you want, know what you can afford, start the process, and keep it seriously. This is the path to get your ideal home.
Time to Get Pre-Qualified
Let’s take the most serious step of all steps in this entire process. You can have money, down payment, good credit, and 1000 other things, but you are not really in the game until you are pre-qualified for a loan. Get pre-qualified, and you show that you are a serious buyer; you will get priority. The value of this is that you will know how much house and money lenders are willing to allow you to borrow, likely interest rate, loan conditions, and the reality of you getting your first home. Take this step to really be in the game.
Ready For a Real Estate Agent?
So, you are really ready to get a house? Now is probably the time to get a real estate agent to start showing you homes. You are now a serious home shopper, and you are pre-qualified for a loan; your credit is in good shape, your income matches what you seek in the marketplace, you have a down payment, then this means you are authentically ready. Time to find a real estate agent who can show you all the homes that match your budget, your realistic desires, and what will fit you best.
