If you feel it is time for your to buy a new home you might be both excited and terrified. Yes, buying a home is a big deal. It is a major financial investment as well as a long-term commitment that can both liberate you and tie you down at the same time. So to make this process a little easier for you, here is a checklist of things you to consider:
A QUICK CHECKLIST
When you are planning to buy a home, this TSW Real Estate Group checklist will help to simplify and organize the process just a little bit:
- credit score
- choose (and buy)
Before you can even think about buying a home, you need to have a good credit score. Getting approved for a 30-year mortgage—in amounts upwards of $100,000 (or more, of course)—is no easy feat, so you need to have pretty stellar credit. Get a store credit card or a secured one, first, and perhaps a cell phone and some auto insurance. This will help you to establish your credit score and improve your credit in the future.
The next thing you will want to do is to determine just how much house you can actually buy. Your banker or lender will help you calculate your monthly payments based on:
- total amount of mortgage
- interest rate
- number of months
Once you know how much your mortgage should be you can then save for your downpayment. For many people, this is the hardest step because it can take many months—even a year or more—but that is understandable.
And while you’re at it, once you make the downpayment, you should continue adding money to your savings account. You are going to need that extra money for furnishings, upgrades, remodels, and then, of course, to help you continue getting better credit in the future.
That savings account will come in handy when your bank looks at your “assets” to preapprove you for the loan. This step is called “preapproval” because you are not necessarily given any money at this time; the bank just looks at your data and decides whether or not you are a healthy investment for them.
CHOOSE/BUY YOUR HOUSE
That’s it. Once you get preapproval you will know how much money you can spend on a house. Now you just go out and find the one you want!