Step-by-Step Guide for First-Time Home Buyers – Tips 1 Thru 8
If you’re a first-time home buyer shopping for homes in Frisco TX, you may want some advice and tips to help you through the process. Following these steps will help you be fully prepared to purchase your first home.
1. Make sure you’re ready to buy
Buying a home is a big investment that requires financial, emotional and practical preparation. Can you afford the monthly payment plus the maintenance expenses of owning a home? Don’t just compare the mortgage payment to your rent. When you own a home, you’re responsible for repairs, maintenance and emergencies. For that reason, it’s safest to have an emergency fund of at least 3 months’ expenses before investing in a home. Also ask yourself whether you’re emotionally ready for the responsibilities of home ownership an able to maintain the home and yard.
2. Manage your credit
Mortgage lenders will look at your credit score and credit report when deciding whether to offer you a loan. Order copies of your credit report from the three major agencies online at AnnualCreditReport.com. Carefully review the reports to check for errors. Meanwhile, optimize your credit score by paying down debt. Avoid taking out any new loans or changing jobs in the two to three years before you apply for a mortgage.
3. Define what you want in a house
Make a list of your must-haves. How many bedrooms do you need? Does the primary suite have to be on the first floor? Do you need a dedicated home office space? Next, list your wants. Would you love a fireplace or a media room? Decide what city you’d like to live in and start looking at neighborhoods and new home communities to narrow down your search area.
4. Consider your mortgage options
There are many kinds of mortgages for different situations, but the standard type is called a conventional mortgage. It has a consistent monthly payment and is issued by a bank or other private lender. Some other types of loans, such as VA and FHA loans, have government backing. Their requirements for credit scores and down payments are more lenient, but to get a VA loan you must be a veteran or active duty service member.
5. Find possible lenders
Shop among a handful of lenders to compare interest rates and terms. You can find lenders online and in your local area. Ask friends, neighbors and real estate agents for their recommendations. If you’re planning to buy a home from a builder, ask if they have a preferred lender. Builders often form working partnerships with lenders to offer the best deals to their customers.
6. Look into first-time home buyer programs
If this will be your first home purchase, you may qualify for assistance or tax credits through special programs. Depending on where you’re buying, down payment assistance and other help may be available from local and state governments. The federal government also offers aid for specific situations through HUD and Fannie Mae.
7. Get preapproved for a mortgage
Apply for preapproval from the lenders you’ve chosen during your research. Getting preapproved will require you to submit documentation of your income, assets and other financial information. The official preapproval letter from the lender will tell you how much you can borrow. This amount plus your down payment will show you what price range of house you can afford.
8. Find a real estate agent
Now you have the financial preparation, home specs and price range to guide your search. It’s time to get a real estate agent and start looking at houses! This is another good time to turn to friends, family and neighbors for recommendations. Look online for reviews as well. Talk to the agents that seem like good candidates. Decide which one you’d like to work with based on their fees, experience and vibe.
In the next post we’ll discuss more tips for buying your first home.
Landon Homes has available new homes starting in the low $500s in the largest master planned communities in Frisco. Call 469-804-5534 today and schedule an appointment to see brand new Quick Move-In homes in Frisco TX.
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