Preparing to buy a home is definitely stressful and it's usually because people aren't sure where to even begin. When you narrow it down to the few things you need to do to prepare yourself, it's a bit easier. This way, you can save your stress for when the time comes to actually start putting in the work to buy the home you've picked out. Here are four steps to help you prepare:
- Check Your Credit: First off, you need to get your credit in check. Obviously, the higher your score, the more likely you are going to receive a decent loan, let alone get approved for one. In general, you will get the best interest rate if your credit is over 740. Work with a financial advisor to determine how you can improve your score. There are a few things you might be able to do that can bump it up quickly. This even includes fixing mistakes that are on your credit report.
- Don't Open New Credit Cards: Opening new credit cards is definitely something you don't want to do when you are preparing to buy a house. This is going to show that you have a new line of credit that hasn't been established well enough to show your ability to pay it off. Always resist this, as well as overspending on everyday items. Stick to a budget so that you won't feel a need for a new credit line and so you can save money on the expenses that come with buying a home.
- Hire a Real Estate Agent: Next, before you start looking at homes, you want to find a real estate agent to help you. You will want someone who is knowledgeable about the specific area and home type you are looking at. Your real estate agent is going to find homes for you to ensure that you end up with the right one for you. This also makes the searching process a whole lot easier because you won't be looking at homes that don't suit your needs.
- Find a Mortgage Lender: Finally, you want to find a mortgage lender. This is not something you want to do after you find a home, but rather before since you need to know how much you can afford. Your mortgage lender will give you a pre-approval rate so that you aren't looking at homes that go over this price. Plus, it shows to the seller that you are serious.
When you follow these four steps, you become better prepared to buy a home and can begin searching and getting started on the actually process of buying the home of your dreams.