If you are preparing to buy your first home, congratulations! However, it is important to note that the market is competitive, and you must be prepared as you transition into this milestone. Demystify your first-time home buying process with this information.
The home buying process can be complicated, but the Lafayette Team with EXP Realty can help demystify it. We specialize in first-time homebuyers and sellers in the Lake Murray and Lexington, SC area.
In this article, we’ll explain what you need to know about buying your first home whether you are just starting your journey or you are ready to buy.
Just Getting Started?
If you’re just getting started in your home-buying journey and you’re not in a hurry, you have time to research and make a plan.
First, you must determine if you are eligible for a mortgage by checking your credit score and history. You are not required to have a perfect 850 to receive approval on a mortgage loan. However, it is important to note that your credit score will have an impact on your mortgage rate. Therefore, the earlier you check your score, the more time you have to make any necessary improvements.
It’s also important to note that most minimum down payments range from around 3% to 5%. Therefore, it’s important to start saving as early as possible. If you are able to contribute more to the down payment, you may be able to reduce your monthly payment or loan term.
Finally, you need to determine your DTI, or debt-to-income ratio. This is the percentage of income used to repay your debts- including a mortgage payment. Most mortgage lenders prefer a DTI of less than 36%, with no more than 28% going towards a mortgage.
Ready to Buy Now?
Maybe you’ve found your perfect home, and you don’t want to wait. While the process can move quickly, it’s important to take the time to prepare, find the right rate, and be confident that you’ve made the right decision for your financial situation.
First, it is critical that you work with an experienced real estate agent. The Lafayette Team at EXP Realty can help you be sure that you are making the right decision.
While the process can move quickly, it is vital that you take time to research your loan options. You should not agree to the first offer that you get because you may miss out on lower rates or a program that better aligns with your needs. While your lender may offer several options, you should also do your own research and ask your realtor for advice.
Apply for pre-approval by submitting an application to your lender and providing the required documents including:
- Credit check
- Tax returns
- W-2s
- Financial statements
While a pre-approval is not a guarantee that you will be approved for a mortgage, many sellers and realtors will only work with buyers that have a pre-approval.
Let the Lafayette Team with EXP Realty Guide Your Journey
The first-time home buying process varies from one person to the next based on the current market conditions, your credit history/score, and other factors. Therefore, as a first-time homebuyer, it’s important to have an experienced realtor on your side to ensure a smooth journey. The Lafayette Team with EXP Realty specializes in first-time homebuyers and sellers. We can help you understand everything you need to know about the process from start to finish.