1 DETERMINE YOUR BUDGET
Can you afford to buy a house? The most influential factor in deciding if you are ready to buy a house should be the state of your finances. What is your income every month? What are your monthly expenses? Are you up to date on all of your bills or are you behind on payments?
If you are currently a renter, using the amount you pay in rent each month as an estimated house payment is a good gauge, but there are other expenses such as property taxes, insurance, maintenance costs and homeowner’s association fees that you need to take into consideration.
Many people think they are not in a position to buy because they don't have enough money saved, but there are loan programs that require no down payment or a modest down payment that are subject to certain restrictions and qualification requirements. Down payment assistance programs and grant funds may also be available for qualified buyers. Please ask a Mortgage Loan professional at Jefferson Bank to determine if you qualify for reduced down payment or any down payment assistance programs.
After you’ve considered your budget and down payment options, the next step is talking to a mortgage lender. All loans are subject to credit approval. With a few key pieces of information such as your income, debt, assets and liabilities, the lender can give you a general idea of how much you can afford to spend on a house. This can alleviate a lot of stress because you know what price range to use during your home search. Your lender will also be able to provide a prequalification letter. Submitting a prequalification letter makes an offer on a house stronger because the seller knows that you have already started the financing process with a lender.
Finding a house that fits your budget is essential, but location plays an important role as well. The ideal location really depends upon your needs. Do you want to find a house close to where you work? Or are you okay with a commute? Do you have school-aged children? What school would you like your children to attend? Do you want a house with a lot of land or something more suburban? It’s imperative to take these things into consideration when deciding where to start looking for your home.
Just as a mortgage lender will guide you through the process for financing your house, a good real estate agent will assist you in the search for a house that meets your needs and your budget. It’s important to find an experienced realtor who knows the area where you are looking to buy. You want to find someone who will be your advocate throughout the process. Ask your family and friends for recommendations. Interview several agents before you hire one. 