Most people have rented an apartment or a house when first starting out or when moving into a new area. But given the choice, most families would prefer to own their own home. Homeownership is usually a good investment and can have some favorable tax advantages. Here are some things to consider as you take steps to make your dream of owning your own place a reality.
Budget – Sit down with your family and create a written budget. This exercise will help identify where you are spending your money and help you determine how much you may be able to save toward a down payment on a new home.
Credit Score – your credit score is a very important part of the home buying process. Basically it shows a lender how much debt you currently have and how likely you are to repay a mortgage. Request your free credit report by going to annualcreditreport.com. Read it carefully, make a note of any false information and take the necessary steps to have that misinformation corrected. Also, check to make sure that all your payments are being reported correctly. Don’t be discouraged if your report is not perfect or if your score is low. By obtaining your report and reviewing it thoroughly, you will be able to take steps to correct past mistakes and get yourself prepared to buy a home.
Down Payment – In addition to saving for a down payment you may qualify for down payment assistance. Lenders understand that stable neighborhoods strengthen the entire community, so some may offer special programs to help people more easily afford the down payment required to purchase a home. Check with your local bank about any down payment assistance for first time home buyers or for purchases on homes located in certain census tracts. A little preparation work ahead of time might really pay off in the end. Follow these steps and you’ll be shopping for that new place sooner than you might think!
Pre-Approval – It’s a good idea to contact your local bank and get pre-approved for a mortgage before you start looking for a home to purchase. This will help you shop with a realistic budget in mind. Many banks offer pre-approval applications right on their website, so you can submit the application anytime.
If owning a home is one of your goals this year, learn more about how to get prepared. Call or stop by Midwest BankCentre today. They have 19 locations in the St. Louis metro area and most recently opened a branch office in University Commons across from Lindenwood University. (314) 633-1222. Midwest BankCentre. Member FDIC. Equal Housing Lender. NMLS#685869