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First Time Home Buyer: How to Get Started

By Vast Bank on 11.19.2019

Are you planning on buying a home for the first time? Buying a house is exciting but also a huge financial investment. It’s not a process you want to go into uninformed.

Not only will it mean thousands of dollars out of your pocket, but it will also impact your life (and your finances) for many years—even decades—to come.

 Here’s what you should do before getting started.

  1. Set your budget. Use a mortgage calculator to determine what you can afford based on your monthly income, existing debts, and other financial factors. This can give you a rough idea of what price range you should be looking in. Remember that you’ll also need cash for your down payment and closing costs, which usually equal around 2 to 5 percent of the home’s price.
  2. Know what you want. Create a must-have list and a nice-to-have list. What features do you want in the home? What locations would you consider? What are your priorities? Having this on hand when touring properties and working with your real estate agent can make the process much smoother.
  3. Shop around. If you want the lowest-cost loan (not to mention the best service), then consider several mortgage lenders—ideally a mix of financial institutions, including banks, credit unions, mortgage companies, etc. Get loan estimates from each and compare and contrast. Fees, rates, and service quality can vary greatly from lender to lender, so make sure you’re getting the best deal before moving forward.
  4. Get pre-approved. Before shopping for your dream home, get pre-approved with your chosen mortgage lender first. This will give you a firm price range to work with and help guide your home search. Pre-approval letters can also give you a competitive edge when submitting an offer.
  5. Choose the right loan. There are dozens of mortgage loan products to choose from, each with different down payment amounts, credit score minimums, and insurance requirements. These can all impact your monthly payment and the overall affordability of your home purchase. Make sure you speak to your loan officer about all of your loan options before moving forward.

Don’t be afraid to be choosy when buying your home. The right vendors are crucial in this process, especially if you’re a first-timer. Carefully consider the lender, agent, builder, title company, and home inspector you use, and make sure you’re getting a great deal, as well as stellar guidance and service.

If you need more help, speak to your loan officer, agent, or banker for financial assistance. They’re all there to help you make the best decisions for your finances and future.

Additional Resources

Need more help prepping for your home purchase? Try some of these resources.

vast-bank-financing-apply-now

References:

  1. Aly J. Yale (May 2, 2018). Shopping Around for Your Mortgage Loan Can Save You Big — Here’s How to Do It. 
  2. Hal M. Bundrick (April 28, 2016). How to Get a Mortgage Preapproval. Retrieved from 
  3. Hal M. Bundrick (September 27, 2017). All The Types of Mortgages — Explained in a Flash. Retrieved from 

 

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