How To Plan For Your First Home

How to Plan For Your First Home

Buying your first home doesn’t happen overnight. There is a lot of planning and preparation that goes into it, similar to if you were planning for a wedding 1-2 years away from the big day! Read the 4 things I recommend doing before you start your search.

Step #1 Do Your Homework

There is a lot of FREE education available and you want to ensure that it is from a reputable source. There are in person and online home buyer courses available. Getting as much background information as you can will help you prepare for the process. Keep in mind that some incentive programs may require you to take home buyer education. Here are a few online courses you can take to get started:

https://www.housingeducation.org/pathways/

https://sf.freddiemac.com/working-with-us/creditsmart/courses#tutorial-with-certificate

https://homeready.frameworkhomeownership.org/

Feel free to email me and I can tell you which one will be a good start for you.

Step #2 Determine Your Budget

There are two figures that are extremely important to consider first:

Monthly Payment Spend – Many people are able to qualify for a lot more than they are comfortable spending per month on their mortgage. Be sure to work on your personal budget so you know where you want your payment to be even before you speak with a lender.

Out of pocket Spend – When you buy a home you pay your down payment + closing costs. You may have heard about down payment assistance programs and seller closing help. Yes! Those do exist to assist in covering those items partially or sometimes in full, but be sure to have a dollar figure in mind that you are willing to spend out of your own pocket for your purchase. Your lender will want to know about any potential gift funds as well. Note – I recommend having about 3-6 months reserves saved up as an emergency fund.

Step # 3 Consider Your Ideal Location

It will be helpful to have a location or two narrowed down. You will want to consider your commute, distance to metro, grocery store, gym, family, restaurants, night life, schools, etc. within the location that you choose. It may even be helpful to pop into a few open houses in the areas you are considering. (Just remember, you are not there to submit any offers at this point, just weighing your options and getting an idea of what is out there).

Step #4 Get Pre-Qualified

Unless you plan to buy your home in cash, you will need to take out a mortgage. Getting pre-qualified before you go out shopping will ensure that you are shopping in the right price range and will make you aware of the estimated costs of buying. If you are ready to start the conversation, you can book a call with me here.

Keep in mind it is never too early to start mortgage planning. We are always happy to help and be a resource for your home financing needs!