25 Tips For First Time Home Buyers

Tips for first time home buyers to follow, to make home buying a smooth process.

25 tips for first-time home buyers

"Photo courtesy of https://www.nerdwallet.com/blog/mortgages/25-tips-for-first-time-home-buyers/

For first time home buyers, the process can be a scary process.  I think that this article will help answer a lot of questions that you may have, to make it easier for you.  This should be an exciting time for you.

1. Start saving for a down payment early

It’s common to put 20% down, but many lenders now permit much less, and first-time home buyer programs allow as little as 3% down. But putting down less than 20% may mean higher costs and paying for private mortgage insurance, and even a small down payment can still be hefty. For example, a 5% down payment on a $200,000 home is $10,000.

Play around with a down payment calculator to help you land on a goal amount. Some tips for saving for a down payment include setting aside tax refunds and work bonuses, setting up an automatic savings plan and using an app to track your progress.

» MORE: Save faster and confidently for a down payment.

2. Determine how much home you can afford

Before you start looking for your dream home, you need to know what’s actually within your price range. Use a home affordability calculator to determine how much you can safely afford to spend.

» MORE: Pay off your debt faster, confidently.

3. Check your credit

When you’re taking out a mortgage loan, your credit will be one of the key factors in whether you’re approved, and it will help determine your interest rate and possibly the loan terms.

So check your credit before you begin the home buying process. Dispute any errors that could be dragging down your credit score and look for opportunities to improve your credit, such as making a dent in any outstanding debts.

4. Pause any new credit activity

Any time you open a new credit account, whether to take out an auto loan or get a new credit card, the lender runs a hard inquiry, which can temporarily ding your credit score. If you’re applying for a mortgage soon, avoid opening new credit accounts to keep your score from dipping.

» MORE: Get your free credit report to check recent credit activity

5. Explore your down payment options

Struggling to come up with enough money for a down payment? First-time home buyer programs are plentiful, including federal mortgage programs with Fannie Mae and Freddie Mac that allow loans with only 3% down.

Other low down payment options include:

For more information call Mike Schwartz at EXIT Realty - Great Plains

*For full article go to https://www.nerdwallet.com/blog/mortgages/25-tips-for-first-time-home-buyers/

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