Here are some tips to help first-time home buyers:
Take the advice.
Your real estate agent is your partner and a valuable asset. They know the neighborhoods and schools and will help negotiate a fair price for the house you want. Your Mortgage Lender can answer questions about how much you can comfortably afford and provide guidance at every step. Get opinions from those you trust, such as your family and friends.
Understand your costs.
In addition to your monthly mortgage payment, you also pay interest, taxes, private mortgage insurance (if your down payment is less than 20% on a conventional loan) and several one-time fees at closing. Talk to your Mortgage Lender and make sure you know the total cost.
Know your score.
A good credit score increases your chances of being approved for a mortgage and may lower your interest rate. If your score is low, try to improve it by making your payments on time, paying the monthly minimum (or more) and keeping your existing credit card accounts with zero balances open.
Estimate how much you can borrow.
You can get an estimate of how much you’ll be able to borrow by being prequalified for a mortgage. You will need to provide some basic financial information and a lender determines how much you may borrow. Prequalification is simple and usually can be done in one conversation.
You’ll need to provide various documents, such as pay stubs, bank statements and tax forms. Make sure you know what papers you need and have them readily accessible. A Mortgage Lender can help you determine what documents are needed or you can print our Mortgage Checklist as a reference.