If you are planning to buy a new house soon, the first thing you will need to do is to get your finances in order. Here are a few things to consider that may be especially helpful for first time homebuyers.
1. Strengthen your credit score. Most lenders will not give you a loan unless you have maintained a good credit score for a while. Ways to improve your credit include paying your bills on time, minimizing your outstanding debt, paying off debt as soon as possible, and resolving any credit disputes or delinquencies.
2. Get pre-approved. Remember that there is a difference between getting pre-approved and getting pre-qualified. Getting pre-qualified only means that a lender has estimated what you can borrow. It doesn’t mean you’ll actually get a loan. On the other hand, pre-approval usually means that a lender is prepared to give you a loan after examining your financial situation. Apply to several lenders within a two-week period so that the inquiries do not do any damage to your credit report. Do this BEFORE looking at potential homes, so that you can have a good idea of what you can actually afford before you fall in love with a home that is beyond your capabilities. Bear in mind that sellers love buyers who are pre-approved, and they are almost always given the green light by lenders.
3. Shop for your mortgage. Again, this will help you determine exactly how much you can afford before you start looking for a home. This way, when you do find a home that you love, you can determine immediately where it is within your price range or if you should let it go because it’s too expensive. You can avoid a lot of heartbreak and stress if you shop for a mortgage first before shopping for a home.
4. Check out first time homebuyers’ programs and see if you qualify. This can be extremely helpful as these programs often have much lower downpayment requirements.
If you are planning to buy a home, let The Incorvaia Team make the process as easy as possible for you. Call us at 440-879-7130 today!
