The thrill of finding a new home may sound exciting but here are a few thoughts before taking the big leap. Let us answer all of your questions so you are prepared to start your house hunt!
- If you are unsure if you should rent or buy, think long term. The real question is how long will you want to live there? If you are looking to move again within the next few months or years maybe renting is your best option.
- Look at the numbers. Realistically how much can you afford to spend? Sit down and go over your financials to see where you’re spending and determine how much you can allocate towards your home. You will also need to add on one time fees from purchasing a home, for example, closing costs and legal fees.
- Check your credit score. If you are like many with not so perfect credit scores be sure to clean it up before setting your eyes on new homes. Pay off any debt and financial mistakes you may have. This will take some time, but once completed it will improve your mortgage rate.
- Get pre-approved. A lender will look at pay stubs, tax returns, and other financial documents to determine how much you will be able to borrow.
- Be prepared for a down payment. Having more money in your bank account is best for lenders to see. Your best bet is to use 3%, 5%, 20% or more towards the total price of your home but save a few thousand for closing costs.
