1. Pay off debt
Even if it means having a smaller down payment to put down on your home, you will make a smart financial decision by paying off high-interest credit cards. In addition, the debt monthly obligation that is eliminated will allow you to qualify for a bigger mortgage. 2. Find a REALTOR
The importance of choosing a REALTOR early in the home buying game is a REALTOR can help answer your early questions and help guide you along the way. Your REALTOR can help you find reputable lenders as well. As a buyer, you pay nothing to a REALTOR for their assistance in your home purchase. 3. Do the Math
Many online mortgage calculators can give you a ballpark estimate of the amount of funding you can afford. Plug in some numbers at Bankrate.com to find out what a house payment would look like for you. 4. Consider your Debt to Income Ratio
Take a look at your budget to see how much of a mortgage you are willing to pay each month. Consider your status if you or your spouse were to lose your job. Common guidelines suggest that your monthly indebtedness to your mortgage payment should not exceed 28% of your gross monthly income. 5. Get Pre-Approved
When you are pre-approved you will know how much of a loan you will qualify for given your credit, income, and down payment information. You will receive a pre-approval letter which you will then be able to use while negotiating for your home. Sellers love to know their buyers can actually go through with the deal and that financing is not still 'up in the air'. 6. Begin Your Home Search
A home is much more than the number of bedrooms, baths & square feet. Your home should be a good fit for your lifestyle as well. Start by writing down your wishes for your new home. Don't forget to consider how long you plan on living in your home, location of bedrooms, and other amenities you would like. For instance, if you are an avid biker you may want a home near bike paths. Your REALTOR can then help you find those homes and help pin-point the areas that may be best suited to your preferences. 7. Choose & Make An Offer on Your Home
You have found your dream home. The listing price is your starting point for your offer and many items need to be carefully considered with your REALTOR to help you present your best offer. At this point you will be able to ask the seller in the contract for any items you wish to have left in the home, including appliances. You will also ask for any inspections to be completed that you want. Again, your REALTOR will have the best negotiating tips based on your specific circumstance.
8. Close on Your Loan
The closing process is a fairly simple one that requires lots of signatures. This is when the actual funds exchange hands and the title is transferred to your name. Prior to closing you will have the opportunity to walk through the home for a final time to ensure nothing has changed since you first saw it. Depending on when your contract states you may move into your new home, you may be moving in that day or you may be waiting 15-30 days. Either way, you will walk away the owner of your new home.
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