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4 Big Tips for First-Time Homebuyers

April 17, 2022

Keys from a first time home buyer

Buying your very first home is such an exciting time. Although it can also be a bit intimidating – it doesn’t have to be. Here’s why – you don’t need to have everything figured out. There are just a few points to have in place to get you started on your way to owning a home. Read on to see what they are.

#1 Have a Great Lender

That might seem like a no-brainer, but it is the most important tip. The loan process isn’t only about getting the lowest interest rate possible. That’s a given. It’s really about having a lender you can trust who knows what they’re doing.

Think of your lender as a guide in the jungle. They know what venomous snakes look like, which logs not to sit on because they’re crocodiles, and where the quicksand is. Follow their lead, and you’ll get out alive. Ignore what they say, and you’re somebody’s lunch.

So that’s your first tip. Use a lender who knows their stuff and you trust.

#2 Have Good Credit

What is “good credit”? It’s a score of 620 and above. That’s the starting point. Once you’re there – it’s time to reach out and start the homebuying process. That means you don’t have to wait until you have excellent credit with a 700 score or above.

While you’re working to attain perfection – rates are going up.

If you aren’t sure what your credit score is, sign up with Experian or Credit Sesame and pull your credit. If your score is lower than what you expected, see how you can improve it. Both programs give great tips.

Besides maintaining your credit, don’t apply for any new credit until you have the keys to your new house in hand. Don’t buy a new car, a new big-screen TV, or furniture on credit. It’s important not to add any debt or lower your score.

#3 Stable Jobs

The next step is to have a stable job you’re comfortable in. The same goes for any co-borrowers. Here’s why. There’s no better way to blow up a loan than to change jobs in the middle of getting approved. The underwriter will be looking to make sure all the borrowers have consistent employment in the same type of job for the last two years.

Of course, there are some exceptions – like if you just got out of college or the military. But generally, that’s what they look for.

So, if you’re looking to change jobs or quit so you can start a business of your own – WAIT until you’re in your new home. Then you can do anything you want.

#4 You Can Save Some Money

Here is another important point: You have to be able to save some money. There will be expenses like a down payment, closing costs, an appraisal, and inspections. You can have a smart lender who can get you a great deal on a mortgage, but you need to be able to afford purchasing a home.

You’re good if there isn’t too much month left at the end of your money. Even if you start small and save a few hundred dollars a month – that’s a start. See how you can cut back on unnecessary expenses and save even more.

Once you have a few thousand saved up, it’s time to jump in the game and apply. Of course, the more money you can save, the better. But just like with your credit score – you’re not going for perfection. You need to get to the starting point to buy a house.

The Bottom Line

Buying your first home is fun, and it doesn’t have to be complicated. Follow the above four tips, and you’re on your way.

Homestead Financial Mortgage is a top mortgage lender for first-time homebuyers. We know how to make the home loan process smooth and stress-free. Our low-interest home loans are some of the best in the states we serve. We service Arkansas, Colorado, Florida, Illinois, Indiana, Kansas, Missouri, Ohio, Tennessee, and Texas. Contact us today to learn more about the home loan products we offer that are right for you.

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