CONGRATULATIONS! You've decided to go for it and want to purchase a home. Buying a home can be thrilling and nerve-wracking at the same time, especially for a first-time home buyer. It's difficult to know exactly what to expect. The learning curve can be steep, but most of the issues can be resolved by doing a little financial homework at the outset. With mortgage interest rates at an all time low, purchasing a home today, can be much less than a monthly rental payment.
FOLLOW THESE 5 STEPS TO HELP MAKE THE PROCESS GO SMOOTHLY
CHECK YOUR CREDIT:
The home buyer's credit score is among the most important factors when it comes to qualifying for a loan these days. The standards are higher in terms of what credit score you need and how it affects the cost of the loan. To get a sense of where your credit stands, go to AnnualCreditReport.com to get your free credit report from each of the three credit bureaus. Scour the reports for mistakes, unpaid accounts or collection accounts. Just because you pay everything on time every month doesn't mean your credit is stellar. The amount of credit you're using relative to your available credit limit, or your credit utilization ratio, can sink a credit score.
The lower the utilization rate, the higher your score will be. Ideally, first-time home buyers would have a lot of credit available, with less than a third of it used. Repairing damaged credit takes time -- and money, if you owe more than lenders would prefer to see relative to your income. Begin the process at least six months before shopping for a home.
~PAM DEVENDORF, REALTOR/BROKER
COLDWELL BANKER RESIDENTIAL REAL ESTATE
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