Tuesday February 16, 2016
Purchasing a home for the first time can be both exciting and terrifying. When the idea of buying your first home seems overwhelming, just remember that Smith Douglas Homes has resources available to help you every step of the way.
Essential Things to Do Before Starting Starting Your Home Search
Check your credit report.
If you are unable to make a down payment or your credit is not great, you may not be able to get a mortgage. For this reason, you need to know your credit score before you begin house hunting. Check out your credit score and make sure that you look carefully for any discrepancies that may be negatively impacting your score. If you find something, make sure to report it so that your credit score is accurate.
Start saving for a down payment.
If you don’t already have a substantial savings account, you should start saving as soon as you think you might be interested in purchasing a home. There are many mortgages that will allow you to purchase a home with as little as 3% down, but the more you put down up front, the better your chances are to qualify and get better rates.
Plan to find a home you’ll stay in for a while.
Buying or selling a home isn’t a cheap venture. If you’re not interested in staying in one place for too long, buying a home may not be the best option for you. The transaction fees are much higher than you’ll experience when renting a new apartment. Because of this, it’s best to make sure you really want to stay in the home for more than a couple of years before you begin the process of purchasing it.
Find out how much mortgage you can afford (and be realistic).
Use an online mortgage calculator and other resources to estimate your monthly mortgage payment. Remember that you will need to include taxes, insurance costs and private mortgage insurance (PMI) when determining your monthly payment.
Gather the documentation you’ll need to get approved.
Once you know how much home you can afford, begin gathering the documents you’ll need to get pre-approved for a mortgage. You will need to provide the mortgage company with the past two years of :
- The name and address of landlords
- W-2 forms
- Tax returns
- Pay stubs
- Bank account statements
- Current loan statements
- Credit line statements
Once you’re ready to start your home search, contact Smith Douglas Homes today. Our New Homes Specialists are ready to help you build a home you’ll love at a price you’ll love even more.