Do you think you’re ready to take the leap to buy a home but you’re not quite sure where to start? We are breaking down the process into bite-sized pieces to help you navigate the steps it will take to turn from renter to homeowner.
Find Out Where You Stand Financially
Review your current financial position. When applying for a house, lenders are looking at many areas of stability like income and credit. Proving your income stability can be accomplished by remaining at the same employer for a period of two years. Also, review your credit report ahead of time by visiting annualcreditreport.com. In the event an error is found, you’ll have time to dispute any errors before a lender officially pulls your credit.
It’s also a good idea to take advantage of mortgage calculators! Chelsea Groton’s website houses a variety of calculators including a mortgage calculator, to help you calculate potential costs and anticipated payments. It’s important to arm yourself with as much information ahead of time, as it will help give you a realistic view of what you can afford.
What and Where Do You Want to Buy?
Determine what type of home would suit your needs and where you want to live. Do you prefer a house, or condo? How do you feel about amenities? Be sure to consider any costs associated with an HOA. Do you want a large amount of land or a small yard? Are you in need of ample room to raise a family or a space just for you and your hobbies? What town or area do you prefer to live in? If you travel to work, keep your commute in mind! Each of these questions will help you narrow down the inventory to consider to tighten your search.
Actions Speak Louder
Showing you are ready for the responsibility of owning a home can help get you the advantage you need in a competitive market. What are some ways you can show your commitment? First, hold off on big purchases or opening new lines of credit. Lenders want to see stability in your financial portfolio. Opening many lines of credit, including new credit cards, may show them otherwise.
Second, when you’re ready, be sure to get pre-qualified! Getting pre-qualified can help you cement your spending range, expedite the closing process, and it lets the seller know that you mean business.
Chelsea Groton holds an array of educational classes including preparing for homebuying. Sign up to join our May 9 homebuying class, Welcome Home!
For additional educational resources, visit Chelsea Groton Bank’s Learning Hub.
