So you think you want to purchase a home but you just don’t know where to start? The biggest questions when thinking about buying your first home is “How do I qualify to purchase a home?” Here is a short list of where you should start. As always, if you have any further questions or need help with the process, reach out to us and we can point you in the right direction.
- Check your credit score: Your credit score is one of the most important factors in mortgage approval. Check your credit score and take steps to improve it if necessary.
- Calculate your debt-to-income ratio: Lenders will want to see that your monthly housing expenses (including mortgage, property taxes, and insurance) will not exceed 28% of your monthly income.
- Save for a down payment: Most lenders require a minimum 3% to 20% down payment.
- Get pre-approved from a lender: This will give you an idea of how much you’ll be able to borrow and what interest rate you can expect.
- Determine your budget: Consider all of the costs associated with owning a home, including the mortgage, property taxes, home insurance, maintenance costs, and utilities.
Once you have a clear understanding of your finances and potential lenders, begin working with a real estate agent or search online for homes within your budget. When you find a home that meets your needs, make an offer, and, after mutual acceptance of the offer, begin the application and loan process.