Excited to shop for your first home? Before you schedule showings and attending open houses, there are a few steps you should take to prepare.
If you're like most first-time homebuyers, you'll need to take out a mortgage in order to pay for your home. Before you apply for any kind of home loan, it's a good idea to know where your credit stands. After all, your credit will be a major determining factor in whether your mortgage application will be approved.
Reviewing your credit score also gives you an opportunity to scrutinize your report for any mistakes or errors that need to be disputed and resolved before you apply for a mortgage.
Next, it's time to secure a pre-approval letter for a home loan. While a pre-approval is not a guarantee that your formal application will be approved, this is a good way for you to get a better idea of how much you'll be able to borrow.
If you haven't already found a real estate agent, now is the time to do so. Because sellers typically pay an agent's commission, you shouldn't have to pay a thing to work with a real estate agent as a first-time buyer. Ideally, you'll want to work with somebody who is familiar with the area in which you wish you buy and has experience helping first-time buyers.
Last but certainly not least, make sure you've saved up some money for your down payment, closing costs and other expenses related to buying your first home. These can add up quickly, so you'll want to be prepared and start saving as soon as possible. Keep in mind that the down payment you are required to make may vary based on your lender and the type of mortgage you choose.
There's a lot that has to happen before you buy your first home. By following these steps, however, you'll be set up for greater success when it's time to shop around!
