How Should I Prepare For Buying A Home?

Maybe you’re living in your parents’ basement. Or maybe you’re sharing an apartment with a roommate who drives you insane. Regardless of the reason, you suddenly have the first-time homebuyer itch. The media likes to focus on the entertaining side of buying a home, like a dramatic house hunt or crazy real estate agent. But there are a few things that you should be focusing on before you start trolling Pinterest for design tips. Granted they’re not glamorous, but following this checklist just might help you land your dream home.

 

• Check out your credit score. It’s always a good idea to keep an eye on your credit report to make sure that all of the information is accurate. Knowing your current score will let you know where you’ll stand with lenders. A high credit score (700 and above) will help you land the best deal. A lower credit score (below 640) means you’ll have to pay a larger down payment and have higher monthly payments.
• Don’t be “house poor.” It’s tempting to go for the five-bedroom home with the movie theater and pool. But do you really need all that house? If it’s just you and your cat, opt for something a bit more modest. But don’t settle. This is a big investment and you should be happy with your purchase. Make a list of what you’re looking for and do some research on the estimated costs.
• Get pre-approved. If you truly are serious about buying that home, then you’re going to have to get pre-approved for a loan. Getting pre-approved will allow you to know how much house you can afford (see above post on “house poor.”) There’s a lot of paperwork involved in getting pre-approved, not to mention finding the right lending institution, so start this process before you start browsing listings.
• Start saving some money. More than likely, you’re going to have to make a down-payment and pay for closing costs. Do yourself a favor and start banking away some cash so you can be prepared.