Five Steps to Owning a Home
Decide What You Want.
Where do you want to live? Do you want a condo, or a single family home? City or ”the burbs”? Do you like to entertain? Do you want a garden? Write down your home ownership goals. Gathering your thoughts now will make decisions you make later in the home buying process much easier. Plus, it’s easier to give up the $5 latte when you have a distinct picture in your mind of what will soon be yours.
Set a Budget and a Timeline.
Although the majority of your home purchase will be financed through a mortgage, you will still need to put a significant amount of money down to get approved for a loan. This amount varies on the type of loan you choose and the price of the home. You won’t know these factors right now, but you can start taking small steps to save. The app Mint.com allows you to set up specific “goals” within your account. Sign up and set a goal of “purchase a home in 18 months” and the app will tell you exactly how much from each paycheck you will need to save in order to achieve this goal.
Easier said than done, we know. However, you don’t need to give up shopping entirely, or stop going out to eat to save money. Baby steps. A great tool to use to easily save is the app Digit evaluates your spending habits and transfers small amounts of money out of your linked bank account into your Digit account, which accrues interest. Savings via text messages…can’t get much easier than that. Now, this tip seems quite obvious, but you would be surprised how much you can save by making small changes to your daily habits. Do you have a gym membership you never use? Cancel it. Do you stop at Starbucks five days a week? Cut it down to two days.
Check Your Credit.
Good credit is essential to obtaining a low mortgage rate. Go to and find out what your current credit score is. Check for mistakes, and if you find any, get the issues cleared up as soon as possible. Check your current interest rates on any loans or credit cards and find out if consolidating your debt with a low interest Personal Loan is an option that makes sense for you. If your credit is poor, don’t get discouraged. You can improve your credit over time by getting current on your payments and staying on top of them each month. No better time to start than now!
In order to purchase a home you will need a Mortgage Loan Officer and a Realtor. Even if you are not ready to buy just yet, we will be able to give you the information you need to prepare you when the time comes. Your loan officer will be able to tell you what you can afford, and what program and interest rate you will qualify for. This information will be valuable to you as you start to plan, budget, and save for that home of your very own.