Before hitting the pavement on the hunt for your first, second or fifth home it’s important to prepare your finances, get preapproved for a loan, know exactly what you want and have a trusted real estate agent on your team.
Before Starting Your Home Search You Should…
Before making the decision to buy a home you should always ensure that your finances are in the right place. In order to qualify for a mortgage you will need to prove your monthly income, have a healthy credit score, low debt-to-income ratio and a reasonable down payment. There are loans available for buyers with less than a 680 credit score and under 10% down payment, but you’re going to pay a lot extra for these loans in insurance and interest rates.
Your credit score should at least be a 680, but a score over 700 is going to make financing easier and less costly to obtain.
Having a 20% down payment will save you money in monthly mortgage costs, as well as additional insurance required to protect lenders against buyers with lower down payments. Figure out how much savings you have to put down on a home—what is that 20% of? At minimum you will need to put down 10% unless you qualify for a special type of financing, such as an FHA loan.
A lender will require you show at least 2-weeks of pay stubs, as well as all debts you are currently paying off. The less overall debt you have at the time of applying for a mortgage the more likely it is you’ll be approved.
Once you feel confident that your finances are in order you can apply for a mortgage pre-approval. Going into the home buying process with pre-approval in hand speeds up the procedure and makes it easier to make an offer when you find the right home. It also prevents a number of common issues with securing finances from popping up at the worst times, such as when you’re already in the escrow process.
We recommend shopping around different lenders. Since you haven’t already found a home at this point you will feel less rushed, allowing you to truly find the best deal out there for you.
Know What You Want In Order Of Importance
Some people just think they’ll know the right house when they see it and this could very well be true, but in all reality budgets and other factors often make it impossible to secure every last thing on your wish list.
Sit down with your family and go over the most important factors for your new home. Is it close proximity to the beach, the best school districts in Brevard, or a certain number of bedrooms to bathrooms?
At this point you have an idea as to how much you can spend because you’ve gone over finances and perhaps have even been preapproved for a loan. By doing an online search you can get a feel for what sort of homes are offered in this price range. A real estate agent offers a lot of valuable insight as to where to look to come as close as possible to fulfilling your wish list while staying on budget.
Find A Real Estate Agent You Can Trust
Buyers never pay real estate agent fees so there’s no reason not to hire one. There are ample benefits to working with a real estate agent when finding your perfect home. These benefits include:
- Working with someone that is knowledgeable about the community helps pinpoint the best location(s) for you to check out. A local agent is also highly versed in local median housing prices and current market conditions. As a result, you score a way better deal and don’t end up overpaying.
- An agent will work around your budget and needs to match you with the right house. Bad deals and unsound homes stand out like sore thumbs to experienced agents, helping you to avoid investing in a money pit.
- Assistance making an offer and preparing all paperwork required to be taken seriously.
- Help managing deadlines so that the deal moves through escrow smoothly.
- Help negotiating the final deal and securing the home as yours.
Buyers never pay real estate agent fees, although some agencies have started charging service fees to buyers. If you work with Curri Properties you never have to worry about these unnecessary and often unexpected charges. On the contrary, we are here to help you get the most house for your money without any surprise charges.