Too many potential home buyers simply put the cart in front of the horse and wind up disappointed when the deal falls through after all that hard work. The key to successfully closing on your first house is all about the preparation. There are a number of things you should be doing long before you call a real estate agent that will put you in the best position to get that house of your dreams.
Follow this simple first-time real estate buying guide and you’ll put yourself in the best position to get the keys to that home you’ve had your eyes on.
Getting Your Credit Report
The very first thing you do as a first-time home buyer is get a free copy of your credit report. If you have recently applied for credit, you are entitled to a free report, and this is going to be one of the most important tips in your journey to getting your house. Carefully scan over all the details and disputer anything that looks like it doesn’t belong or is a mistake. The reporting agency will take your dispute and contact the other party to see if it is valid. If the other side does not respond, the report will be removed and your score increased.
Improving Your Credit Score
Now that you have your credit report in hand, you’ll be in the best position to see where you can make improvements to help boost your credit score. Open a Green Square wealth management account, to get advice on how to clean up your financial history. If you carry a higher balance on some credit cards, reducing the debt-to-income ration is a great way to boost your overall number. If you have been only paying the minimum on certain cards, even increasing the payment slightly can have a huge positive impact on your credit scores. Since you are doing this first, the financial institution you eventually choose for the mortgage have no idea where you started, they will only be interested in your current scores after you give them a boost.
Getting Pre-Approved for the Loan
Once your credit scores are as high as they can be, now is the time to reach out to a lending institution of your choice about financing for the house. Don’t settle on the first lender, use your credit scores as leverage to negotiate the lowest possible interest rates and be sure that you get a mortgage commitment in writing. Walking into a seller’s house and showing the listing agent that you have a commitment in hand will help move you to the front of the line if there are other buyers interested in the same property. When you sell a house, you want to close the deal quickly, and seeing a buyer with papers already in hand is something that will not go unnoticed.
Know All Your Down Payment Options
Just because you have some money set aside for a down payment, don’t go rushing in to put it all down on the house. There are a number of options available to a first-time home buyer, one being you want to get the lowest possible interest rate so that you pay less for the house over the years. If you have the ability to buy points to lower the interest rate and still have enough for the minimum down payment, this could really help to get you off on the right foot.
Hiring the Best Local Realtor
Now that you have all your ducks in a row, it is time to reach out an hire the best local real estate agent. Since you have your credit and financials in order, your agent is going to work tirelessly to find the right house for you and get you in position to get in an offer before another buyer beats you to it. Since everything is now in order, it is less likely that something will cause the sale to fall through at closing. All you’ll do at this point is see as many houses as possible and present the offer when you find the house of your dreams.
Take your time early in this buying process and don’t start looking for houses until you complete these steps. This will help you avoid the heartbreak of losing the house to another buyer and give you the best chance to get through the entire buying process with less in the way of issues that could derail the sale.