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DON'T BUY A HOUSE!! (Till you do these first 6 things.)

Sep 9, 2008
Buying your first home is down right scary for most people. Your facing the unknown in most cases. Terms you don't know...payments your not sure of...and I wont even mention the contracts to sign. Some studies show that some people are so over come with anxiety that they wont take the first steps to even buying a home.

For most of us, buying a house is the largest purchase we will ever make. and of course the first time is by far the hardest. So make sure to take advantage of ALL the home buying information you can.

Be sure to prepare yourself before buying. Here are six steps to follow before buying:

1) For most people, home ownership is an integral part of the American dream and the advantages (tax benefits, sense of home, financial investment) far out weigh any drawbacks.Think about what it will be like to be a homeowner.

2) Have an idea about your credit right from the start. Your FICO score will normally be between 400 and 850. the higher the score the better your funding chances are. Get a copy of your credit report and review it. Look for any discrepencies and report them to the agency. In some cases you may want to use a credit repair agency.

3) Know your finances. A down payment is a big barrier to homeownership. There are, however, many different loans/mortgages out there that offer low down payment options. You should work with a quality mortgage broker or banker to find out what would work best for your situation. And don't forget the government...a HUD loan is usually a great way to get into your first home also. Again, check with your broker or banker for more specifics.

4) When meeting with a good mortgage broker or banker, ask them to pre-approve you, not pre-qualify you. Pre-approval is an actual underwriting of your file (whether manually or auto-underwritten) and will let you know how much you can actually spend on a house and up to what rate you would be able to go to. This means, of course, that you will have to provide your income documentation, credit, and various other items required by the lender to actually underwrite your file. When you are ready to make an offer on a home, you'll have more bargaining power over someone who is just pre-qualified, which just means someone has looked over your info and thinks you would qualify for financing.

5) While meeting with your mortgage broker or banker, have them look into any down payment assistance programs that may be available. There are many programs out there run by counties and cities and other agencies. The trick is to know about them, first, and then to see if you qualify for them.

6) First-time home buyer classes. Many lenders and Realtors offer home buyer education classes. They are usually a few hours long and will educate you through the process of buying a home. From applying for a loan, working with a Realtor, making an offer, going to escrow (closing), and various other responsibilities associated with owning your own home.

These six steps will help you on your path to owning a home. Just remember to ask LOTS of questions. Talk to friends and family who are home owners and see who they trust. Buying a home doesnt have to be scary as long as you understand what your getting into.
About the Author
Doc Schmyz has worked with investors all over the U.S.. His website gives thousands of investors up to date real estate investing information Get more info from across the U.S. on Doc's real estate investing resources page.
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