Did you know that most Millenials are delaying the purchase of their first home? Many have no choice because of affordability concerns, debt, and other factors. But if you’re one of the lucky ones in this generation that can afford a home, now is the perfect time to start learning about the process and get homebuyer help.
Buying a home in this new era can be intimidating, especially as a young person. Don’t let that keep you from finding your dream home! Take a look at this first-time home buyer guide to start.
Figure Out How Much You Can Afford
It may sound obvious, but the first step in this home buying guide is to sit down and figure out how much you can afford. In an ideal world, you should only spend 35 % of your income (pretax) on your mortgage. Once you’ve established that, you’ll know how big of a mortgage you can take out–and what housing price range you should look at.
Put Away Money for a Down Payment
Now that you’ve learned what size mortgage you can handle, the next thing to do is to save up for your down payment. The amount that you’ll need depends on the type of mortgage program you will qualify for. But in general, the bigger the down payment the better it will be since that will reduce the total mortgage amount and result in a lower monthly cost.
Pay Off Your Debt
Another key action to take is to pay off any outstanding debt. Many mortgage lenders will allow only a certain amount of debt to loan ratio. Find out in advance what this is so you can get rid of any debt that might hold you back.
Get a Mortgage Pre-Approval
One of the top home buyer tips in making the process easier is to get pre-approved for a mortgage before you start shopping for a house. That way if you find a property that you love, you’ll be able to make a competitive offer. It will also make the closing period shorter and get you into your home faster.
Home Buyer Guide To Selling Houses Fast
If you’re fortunate enough to own a home that you need to get rid of quickly so that you can buy another, there are options. You can always go with a professional home buying company that will buy your house for cash. There’s more information here about the process.
Ready To Buy Your First Home?
Now that you’ve read this first-time home buyer guide, you can feel more confident about starting your house search. Before jumping into the exciting world of house sales, do your research and determine how much you can afford first. Once you’ve got your down payment ready and a mortgage pre-approval secured you can proceed.
Want to learn more home-related tips? If you found this article useful, check out some of the other real estate topics on this site.