First-Time Homebuyer? Don’t Be Scared – Be Prepared
Buying a home will probably be the single biggest buy most people ever make. And that kind of commitment can be scary. It can seem very complicated, and a lot of things can seem to be out of your control. But if you are fully prepared with knowledge about the time of action, you’ll reduce the stress and anxiety considerably. And everything will likely go a lot more smoothly and efficiently.
Start your education by studying up on these basics:
How to finance a home. How to choose a neighborhood/home that’s right for you. How to insure a home. How to care for a home/character.
Before you look at neighborhoods, you should look at your credit score.
Request your credit report from these three credit-reporting agencies: TransUnion, Equifax, and Experian to see where you stand in the eyes of a possible mortgage lender. Review your credit report’s FICO score. A number somewhere between 300 and 850 tells lenders what kind of borrower you’ll probably be-based on your credit history. And the higher your score, the better you’ll look to a lender. You can order a free copy of your credit report from these agencies once every 12 months. If there are any issues regarding your credit score that may stop you from getting a home mortgage loan, check those credit-reporting agencies’ websites for tips on improving your credit score.
Once you know you have an permissible credit score, it’s time to get pre-qualified for a mortgage loan. The pre-qualification course of action helps you get a clear picture of what kind of home is in your price range, and how much of a monthly payment you can provide. You’ll need to provide some basic information in order to get pre-qualified; this includes documentation of your income, in addition as recent statements for all checking, savings, and other asset accounts.
Once you’ve got you financial jitters calmed down, it’s time to choose the neighborhood and house that’s right for you. If you have school-age children, you’ll probably want to put a neighborhood with good schools at the top of your “where to look” list. already if your children are currently in elementary school, plan ahead for the years to come; consider a neighborhood in terms of the quality of its middle school and high school, too.
As for the house, your lifestyle, your budget, and your taste should weigh heavily in your decision. It’s also a good idea to consider what the “norm” is in a home-what most buyers are looking for-should you ever want to sell your home a few years down the road. Right now, the most popular homes have three bedrooms, two baths, and a two-car garage.
Once you’ve done all the looking and comparing, and have settled on “the” house, you’ll need to take care of all the things that protect you before, during, and after the buy. There’s the inspection by a licensed inspector, plus a separate inspection for wood-destroying insects like termites. The home should literally be checked from top to bottom by experts-anything less is unacceptable and extremely unwise. While all the inspections are going on, you should be looking for a home insurance company, because proof of insurance is necessary at closing. By the way, at every step along the way, everything should be written down. Nothing should be verbal. keep up on to this paperwork and keep it organized and quickly easy to reach; you won’t regret this!
Once you and the seller come to an agreement, the contract, price, and terms go to the mortgage company, which will send an appraiser to check that the home you’re buying is worth what they’re lending you. If all is well, they’ll proceed with the loan.
Next? The date for the closing is set. That’s the day the legal move of the house is completed. Once all the documents have been signed, you’ll get the keys to your new home. Proof that, yes indeed, it’s really, truly yours.