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If you are considering buying your first home, there are a lot of things you should do a long time before you even start looking for one. For starters, you need to sit down and figure out if this is truly the right time for you to get a mortgage. Are you ready to settle in a specific city and area? Are you sure you want to tie yourself to a possible lifetime of payments at this time? If you do not have a steady paycheck or if you are struggling to find your career path, it may not be the time to think about your first home. If, however, you are sure that this is the right step for you, here are some things you need to think about:
Start by checking your credit report. You can do this easily online at FreeCreditReport and other websites. By doing this early, you can make sure everything is in order or correct any mistakes on the report that can hinder your chances of getting your first home. You should also check your FICO score, the number which gives lenders an idea of how good your credit history is.
When you are looking for your first home, start your search early. Use the Internet to preview homes in your area and to get an idea of prices and sizes. In fact, many real estate companies now offer virtual tours, where you can take a look at a home both on the inside and outside from your home.
Make sure you decide beforehand what you want in your first home: Tudor or Ranch style? How many bedrooms? Backyard? Pool? Knowing what you want before you start looking for your first home will make the search much easier. When you are ready to start seeing real houses, remember to bring a digital camera with you. The typical buyer visits 5-10 buildings in a single day, and it becomes easy to mix up the different houses.
Once you've found your dream first home, get as much information as you can on it. What will your expenses be besides mortgage: property taxes, homeowner's insurance, repairs and structural changes? Make sure you know what to expect and make a plan on how you will deal with it.
Sunny27- I agree with you. Pre-qualification helps when you are making an offer and there are additional bids on the property.
Many times people don’t prepare properly and lose out on a deal because the seller accepts the buyer that took the time to get pre-qualified.
Also, I would imagine that a first time buyer must feel a bit nervous about buying their home and the pre-qualification acts like a stamp of approval from the bank.
Buyers, especially new buyers, should also have at least 20% down to place on the home. Not only does it make the home more affordable but the buyer eliminates the need for private mortgage insurance.
Good article, but I wanted to add that pre-qualification is a must for anyone looking to purchase a home. Take the time to find the right mortgage and get pre-approved before you begin your home search.
This way you know what you can afford and will focus on homes in that price point. Also, if you happen to find the home of your dreams, you will have more leverage when placing an offer. This offers the buyer more credibility in the eyes of the seller.
Also, real estate agents hesitate to work with buyers who are not pre-approved. Buyers with pre-approval tend to appear more serious.
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