Everything You Need to Know About Buying Your First Home

When beginning the home buying process, it’s crucial to get a copy of your credit reports and scores. If you’re buying with a spouse, or someone else, they’ll need to run their credit too. You’ll want the highest score possible, before you apply for a mortgage. A score of 740 or higher is considered to be excellent credit. Typically, anything below 700 is not considered excellent credit. However, this doesn’t mean you can’t get a mortgage.

If you have bad credit, don’t panic, as there are different ways to improve your credit. One of the best ways to improve your credit is to try to stay below 30% of your total credit limits. If you have past due payments, deal with them. Add all your due dates to your calendar to make sure your bills are up to date and paid on time. Remember don’t open new credit cards if you don’t need them, and use your credit responsibly at all times.

From this point, it’s important to meet with a mortgage broker, who generally works for a lender to determine how much you can afford. A mortgage lender is generally a financial institution that loans you money to purchase a home, which is called a mortgage.

Lenders will want to see that you currently have multiple lines of credit available, which you pay off regularly. Lines of credit include the following: credit cards, student loans, automobile loans or any other types of loans. Lenders generally want to see activity on these lines of credit from the previous twelve months.

Financial institutions will analyze your debt-to-income ratio to determine what exactly you will qualify for. During this process, ask your mortgage broker to get a pre-approval letter, for the amount that your financial institution will lend you. Now that you know what you can afford, it will help the seller have confidence in your offer when you find the home you wish to purchase.

It is important, once you apply for a mortgage, to not take on any new debt and or change employers as lenders want to see stability in a borrower. Financial institutions also want to see stability from the previous 24 months from the time of applying for a mortgage. Financial institutions do this as a way to ensure that borrowers do not make any decisions that may upend their ability to make mortgage payments.

When you’re looking to buy a home, begin by finding a trusted real estate attorney. He or she will be able to help you avoid common problems that can arise with the purchase of a home. Being that a real estate attorney is trained in this type of law, they can help a buyer avoid unclear terms and help a buyer fully understand the various contracts they’ll have to sign.

Now that you’ve selected a trusted real estate agent, start looking for homes. Make a list of what you must have. When looking at homes, take pictures and videos, this way you can remember the specifics about each and every home you visit. It’s a good idea to drive through the area at different times of the day to check out how long it takes to commute to your workplace. If you have children in school, make an appointment with a school administrator. During this process you’ll most likely view a number of different homes, so don’t get discouraged.

Once you’ve looked at many different options, and you find a home that you love, it’s time to make an offer. When you find the home that’s right for you, and once you’ve agreed on the price and terms, you’re almost done. Always ask to have a home inspection along with an engineer’s report, if needed, and make sure you view the report as soon as possible. This will highlight any engineering problems in the home and provide a detailed engineering analysis, along with any potential engineering design flaws.