Buying a home for the first time can be a daunting process. But there are steps people can take to make it a little less worrisome. Enterprises TV relays what to prepare before buying a home.
A great deal of importance is placed on credit reports. One of the first things to consider before buying a home is to pay down debt. Pay off as much as possible so lenders get an idea of how much debt is being carried. Check credit reports periodically and stagger them every three months or so. A credit rating of 720 is considered good. Anything above 750 is considered excellent. And be sure to pay bills on time as this also shows on credit reports.
Save at least 20 percent of the home price. This may prevent having to purchase private mortgage insurance later. Private mortgage insurance is generally one to two percent of the loan value, split into monthly payments, which can add an extra $100 to $200 to the monthly mortgage payment. Why pay that?
Hammer out a monthly home budget. This includes: mortgage, homeowner’s insurance, flood insurance, utilities, possible homeowner association fees, and of course, property taxes.
The Enterprises TV show also suggests gathering all needed documents together. These include previous tax returns, pay stubs, canceled checks for utilities, credit card statements, student loan documentation and whatever else you think a lender might want to see. Keep it all together and organized to make it easier for both buyer and lender. Buying a home is a huge personal goal for many first time buyers. It gives one a sense of pride. It can be a little less daunting when all the needed information is collected and the numbers are calculated to produce the home of one’s dreams.