Buying your first home can be very exciting, but it can also be daunting! It’s a huge commitment and requires a lot of planning, but we know you can do it with the proper timeline and tips! This article will cover five tips for first-time homebuyers in 2022. So don’t be deterred by the planning it takes to buy a first home. With discipline and a plan, you’ll be just fine!
1. Check Your Credit and Work on It
You should check your credit about a year out from when you plan to buy a home. This means looking for errors or past-due accounts that might have gone to collections. Roadblocks like these can cause issues when applying for a home loan. If you find issues, contact the creditor to see if you can sort them out. Keep an eye on your credit through credit monitoring services. Check it across a few platforms to make sure it’s accurate. A good credit score will benefit you later because a higher credit score will get you a better interest rate on your mortgage.
2. Decide on a Budget
When you’ve come to 6 to 8 months away from buying your first home, you should figure out what you want your budget to be. You can do this by looking at your monthly spending to see what you can afford as far as principal, interest, taxes, and insurance goes. A good rule of thumb is to expect to spend 1 percent to 3 percent of the value of their homes each year on house expenses.
3. Deposit Any Assets
At 3 to 4 months out, you need to deposit any assets you have into your checking or savings accounts so they can age appropriately. Usually, mortgage lenders look at your bank statements from the last two months, so that’s why it’s important to get your assets in place before that 60-day window.
4. Preapproval for First Time Homebuyers
It would help if you were getting preapproved for a mortgage two months out. Be aware that preapprovals usually expire after 90 days, so once you’ve decided on a lender, ask how long your preapproval is good for.
5. Don’t Go Rogue
Just because you’ve been preapproved doesn’t mean it will stay that way, so don’t go rogue on big purchases or take on more debt. Lenders continue to check your credit, bank statements, income, and employment just before closing to make sure you’re still able to handle the repayment. By making big purchases, taking out new loans or lines of credit, or even closing accounts, you can delay the closing or kill your loan altogether.
If you need assistance with your Houston home-buying plan, or you’re looking for more tips for first-time Houston homebuyers in 2022, contact Flash Realty Solutions! One of our experts can sit down with you to discuss the best course of action for you. We want to make home-buying as easy as possible for you. After all, buying a new home should be exciting!