From investing in your future to achieving greater independence, there are many benefits of owning a home. But before you can enjoy these benefits, you must fully prepare yourself financially. As a first-time buyer, navigating the home loan process can be daunting. Fortunately, there are many resources available to help ensure you find the right property for the right price without putting your finances in jeopardy. To avoid obstacles along the way, consider these important financing tips.

5 Home Loan Tips for First-Time Buyers

1. Consider Your Credit

Your credit score plays a big role in determining which home loans you qualify for—and how favorable the terms will be. When you first start considering homeownership, request your credit report from a verified provider. If your score isn’t favorable, identify and repair issues that may be bringing it down—such as alleviating credit card debt.

2. Start Saving

Since down payment and closing costs can be considerable, it’s important to save as much as you can to ensure they’re covered without stretching yourself thin. Buyers should generally save up 20% of their targeted purchase price for a down payment. If this is unfeasible, talk to your lender about potential ways you can pay less.

3. Explore Loan Programs

There are many programs available to buyers who may need assistance purchasing a home. For example, FHA loans provide first-time buyers with a low-interest mortgage and minimal down payment requirements. VA loans work similarly but are designed specifically for those who have served in the military.

4. Get Pre-Approved

Before you investigate the real estate market, visit various lenders and get pre-approved for a home loan first. With a pre-approval letter, you can verify that you have lending options—and show sellers you're serious. You’ll also be able to see how much mortgage you can afford, which will help narrow down options during the property search.

5. Work With a Reputable Real Estate Agent

When you’re ready to look at properties, find a licensed real estate agent you can trust—such as one that your friends or family recommend. These professionals will not only help you find optimal houses for your needs but also help structure your offer so you’re able to potentially save money on the asking price.

 

Although there are many steps to buying a home, navigating the process isn’t something you have to do alone. If you’re looking for a house in the Dallas-Fort Worth area, Deuane Woodard—a loanDepot® loan consultant—can help you develop a sound financing strategy. With an in-depth knowledge of the local market and lending procedures, Mr. Woodard can help you prepare for the pre-approval process as well as apply for advantage programs—such as FHA or VA loans. To learn more about this home loan assistance, call the North Richland Hills, TX, office at (817) 875-6043.

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