Tips for the First-Time Home Buyer

Do you have dreams of buying your first home?  Whether you’re ready now, or even if you don’t think you’ll be ready for a year or two, it never hurts to be prepared.  Talk to a loan officer about different loan options and look over your current debt.  If you need to, take the steps now to boost your credit rating or pay down debt.  When you ARE ready to start shopping for a home, stop in to chat with that loan officer again and get pre-approved for financing.  This will help you determine the price range of homes that you can afford before you start looking.  You should also talk to a real estate agent about what you’re looking for and get signed up with email listings.  You’ll stay up-to-date with new properties while at the same time getting an idea of the types of homes within your budget.    

One thing that will help you from the start is saving. If you know you’ll be in the market to buy a home in the next couple years, you’ll want to start to save what you can. Putting down 20% will help you avoid having Private Mortgage Insurance (PMI) added on to your monthly mortgage payments.  PMI is insurance that allows lenders to safely accept a lower down payment than it would normally require.   Basically, it is a financial guaranty that protects the lender from losses in the event that you would default on the loan.  

On the other hand, if you don’t have 20% to put down, you can still buy a home with PMI.  As long as you have a conventional mortgage, once your loan is paid down to 78% of the home value the PMI will automatically drop off. 

Start making a list of what you do and don’t want in a home, similar to what you see on all those home buying TV shows.  This is an investment – and a pretty expensive one!  Keep in mind what you can and cannot change in a home.  You can always remodel the kitchen or put in hardwood floors but you can’t change the neighborhood or make the lot bigger. 

We’d be glad to help from start to finish on making your first home your dream home.   Call or make an appointment to talk to a loan officer to go over your finances or apply for a mortgage.  And once you’re in your home, we can even help you turn your house into your dream home by financing your remodel!  

Post by: Sara D

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