Things to Consider Before Buying a Home
Buying a house is one of the largest purchases that most people will make in their lifetime. Given that, it is very important to properly prepare for the home buying process to ensure that all goes as smoothly as possible.
Conduct a Credit Review
One of the factors in determining the terms of your mortgage is your credit score. Conduct a thorough review of your credit to see what kind of shape it’s in. If your credit is less than ideal, don’t worry. There are still options for people with less-than-perfect credit. If there are errors or discrepancies in your report, make sure to report them immediately to the credit bureaus. A good credit rating could save you thousands of dollars over the life of your loan.
Reduce Your Debt
Very few people are completely debt-free so lenders expect you to have some debt. However, they will be factoring your debt-to-income ratio (commonly referred to as DTI), which is the percentage of your gross monthly income that goes toward paying your debts. The lower your ratio, the better for you. Consider improving your debt-to-income ratio before applying for a loan.
Get Pre-Qualified/Determine How Much Home you Can Afford
One of the most important things you can do in the home buying process is to obtain a pre-qualification letter from a lender. This will also inform you about the price of the home you can afford to buy. In addition, being pre-qualified will help you to compete with other buyers when making an offer on a house.
Find the Best Real Estate Agent for You
Every buyer will have their own preferences about what they are looking for in a real estate agent. For some, it could be experience and background; for others, personality, character, and attitude might matter more. Whatever your criteria, it is important to find someone who is trustworthy, knowledgeable, and responsive. It is also extremely helpful to find an agent who is well-informed about the community in which you are looking to buy.
Did you know that Carrington has a full-service brokerage affiliate, Vylla Home? Please contact your loan officer for more details to find out how you may be able to save on your next home purchase. Our Purchase Edge Program is designed to give you a financial edge in the home buying process!
Location
Do your research. Finding the right home in the right neighborhood takes time. There is no need to rush this process. Take your time.
Things you will want to consider include:
- Schools (if you have children).
- Safety and crime rates.
- Amenities nearby such as grocery stores, gas stations, hospital etc.
- How long will you be in the property? Can you see yourself in the home for that time period?
- Tour the neighborhood as well as the home.
Calculate All Your Costs
There are expenses that come with a buying a home beyond your monthly mortgage. In addition to your down payment, there are one-time fees such as closing costs, appraiser fees, home inspection fees and moving costs, in addition to ongoing expenses such as mortgage insurance, homeowner’s insurance and property taxes. It is important to have all of these costs budgeted and accounted for.
These are just a few considerations to have in mind when beginning the home buying journey, but it is a good place to start. Don’t hesitate to rely on your loan officer to guide you through the process.
If you wish to speak to a loan officer, contact us at 855-376-4611.
