First Time Home Buyer’s Guide
Effy’s Top Homebuying Tip: Flexible Expectations!
Make sure you’re (really) ready!
• You have a stable job.
• You can see yourself living in the same town for the next 5-10 years.
• You’re prepared for the extra work and expenses that comes with homeownership.
Create your home wish list!
• Determine what’s most important to have right now – location, number of bedrooms, a yard, etc.
• Check out the different neighborhoods in your desired area, home styles, and listings online to get a feel for what’s most important to you.
Assemble your team!
• Find a Real Estate Agent that you trust and communicate with well. A great way to determine if an agent is for you, is to meet for coffee first. This can give you a chance to ask any questions you would like and see if your personalities mesh well together.
• Some homebuyers find it helpful to have a trusted friend or loved one to assist during the home-buying process for second opinions, reassurance and support.
Gather necessary documents.
• Collect paper or digital copies of proof of employment including pay stubs and past tax returns.
• Print out all bank and investment account statements from the last 90 days.
• Compile your previous addresses and have your current landlord’s contact information handy.
• Request a credit report from all three credit bureaus (Equifax, Experian, and TransUnion). Fix any errors as soon as possible.
Contact a mortgage lender and figure out what you can afford.
Barry from Cazle Mortgage.
• Speak to a local and licensed lender. If you already know someone, great! Otherwise, your Agent would be happy to recommend one of their trusted lenders.
• Determine an affordable down payment amount. This ranges from 3-20%. This is a reason why we recommend speaking to a local, licensed lender before beginning your home search so you may get information on first-time home buyer benefits and if you can afford to put down as little as a 3% down payment. Keep in mind that a down payment under 20% requires mortgage insurance which would be an additional monthly expense.
• Calculate how much would make you feel the most secure having in an emergency fund for unexpected maintenance and home repair costs that may arise in the first year of home ownership.
• Get pre-approved for a loan. (Most sellers will not consider an offer unless you’ve been pre-approved)
• Obtain a pre-approval letter (this does require a background and credit check; however it can make you a stronger candidate).
Barry from Cazle Mortgage speaks on the pre-qualification process.