First Time Home Buyer’s Quick Mortgage Prep Guide
Design by Diana Walton- Houston First Time Home Buyer Specialist
Hello and welcome to Houston First Time Home Buyers Edition, formally First Home Houston (FHH), where we provide useful information to help Houston first time home buyers make the most informed decision when it comes to buying, decorating, and maintaining their first home.
Now that you are thinking of or in the process of buying your new home, you will need to apply for and get approved for a mortgage before closing and moving into your new home.
While the mortgage process can be a bit stressful, especially for first time home buyers, understanding the basics and being prepared can help you to get the best possible terms on your loan and save you hundreds of dollars per month. Below you will find a few fairly quick steps to help get you prepared.
1. Know your credit scores. If you have a credit score of 580 or higher, you can apply for an FHA loan. However, you may not get the best interest rate available. In addition, with a 580 credit score, your down payment requirement maybe 10%, not 3.5%.
2. Know how much mortgage payment you can comfortably afford. Although health care cost, child care, utilities, groceries, education and savings cost are not on the mortgage application, you do want to keep these costs in mind as you set your mortgage payment.
3. Set a budget and stick to it. You will be glad you did.
4. Make sure you have money for your closing cost and down payment set aside. If you need more time to save, make that a part of your plan. Waiting until the last minute to get money together will be extremely stressful. Do not forget about down payment assistance programs. They are there if you need them. Just keep in mind, your mortgage interest rate will be higher with down payment assistance.
5. Choose the right Realtor and lender to work with.I cannot stress this enough. Make sure to work with professionals that are looking out for your best interest and not theirs. All realtors and lenders are not the same.
6. Speak with your Realtor and loan officer to help determine the best type of mortgage for you, but make the final decision is your own.
7. Compare current mortgage rates with the help of both your Realtor and lender.
8. Make sure to get per-approved – not per-qualified. The difference is very significant and will either increase your stress level or reduce it.
9. Only view homes that are within your price point. This is where you will need to pay very close attention, so you do not go over your budget.
10. Keep in mind that the mortgage process will continue until you either receive final approval and closing on your new home or denial. And if you are denied, it does not mean you give you, you will just need to make some adjustments, like paying things down or off, increase your credit score, or choose a different. One that you like of course.
Knowing these basics, can greatly reduce and or eliminate the associated stress with applying for your mortgage. Preparing to apply for a mortgage is a big step and we want you to make the right one. Congratulations on getting the ball rolling. We will see you at the closing table.
As always, thank you so much for stopping by. Remember, if you are thinking of purchasing your first home, please contact us. We are here to help. We have been helping Houston first time home buyers since 2011 and we can help you. I hope you have an amazing day. Until next time...Diana
