Home Buying: Make a List Check It Twice

Have some of our beautiful Columbia homes for sale been catching your eye? If you’re thinking about buying a home, taking some steps to prepare yourself ahead of time will help ensure everything goes smoothly.

While the whole process might seem overwhelming at first, it’s very simple. To help you get started, our real estate agents have created this list of the six most important things you’ll want to begin working on right away.

1. Check Your Credit Score
   Your credit score determines whether you qualify for a home loan and the interest rate you’ll pay. Checking it right away gives you a chance to take the necessary steps to raise your score.You’ll also want to review your credit report to make sure all of the information is accurate. You can download a free copy once a year by visiting AnnualCreditReport.com. If you notice any discrepancies, contact the credit reporting agencies right away so they can start working on a resolution.
2. Determine Your Price Range
   Use an online calculator or work with a mortgage lender to determine how much you can afford for your new home. You’ll need to consider your down-payment, monthly mortgage payment, closing costs, property taxes, and other expenses like utilities, maintenance, and homeowner’s association fees.Remember that the type of mortgage you choose and the current interest rates will also impact your overall cost.  As a general rule of thumb, a good recommendation to determine your price range is to keep total housing costs below 28 percent of your gross monthly income.
3. Save Up Your Down-Payment
   Some lenders allow you to purchase a home with a down payment as low as three to five percent. Remember, however, that if you choose to put down less than 20 percent of your purchase price, you’ll be required to pay private mortgage insurance (PMI) premiums until you reach the 20 percent threshold.If you’re serious about saving up for your down payment, it’s always a good idea to set up a separate bank account. Determine exactly how much you need to put away each month and set up an automatic savings plan.
4. Get Pre-Qualified
   In today’s real estate market, most sellers won’t even entertain an offer unless the buyer already has a pre-qualification letter. Once you’ve chosen the mortgage lender you want to use, they’ll review your finances and provide you with a letter stating how much they’ve agreed to lend you. This will put you ahead of the game when the time comes to put in your offer.
5. Hold Tight
   Once you’ve been pre-qualified for a loan, any changes you make to your finances could require you to start over. This means you’ll want to avoid opening any new credit accounts or changing your employment status. Buying a car, taking out a loan for furniture, or anything else that requires a credit inquiry could cause you to lose your dream home. Don’t make this mistake!
6. Find a Great Real Estate Agent
   The home buying process can be daunting, especially if it’s your first time. The expertise and professional knowledge a real estate agent brings to the table is indispensable and well worth the cost. A great real estate agent can help you find the perfect home, guide you through the negotiation process, and stay by your side until you have your new house keys in hand.

Are you ready to get started on your home-buying journey? We would love to help! Contact Columbia Real Estate today to get started.