Buying a home is still a major component of the American Dream. Owning your own home is a rite of passage and when you do it right, it is a good step toward building a portfolio of assets. If you’re thinking of buying your first home this year, take steps to prepare yourself so that the process can go as smoothly as possible.
“We bought our first home this year, and going through the experience gave me a real appreciation of the applicant experience. I also have many clients who are now focused more on hiring for a “full documentation” mortgage processer because of the anticipation that there is a bubble of first time home buyers out there!” says Steve Scovner, Account Manager for the Professional Staffing Group at Contemporary Staffing.
Why Now Is A Good Time to Buy
Now is an ideal time to get the ball rolling on your first home purchase. While things can change over time, low interest rates are still offsetting rising home costs. According to real estate website Trulia, for buyers planning on making a 20% down payment, purchasing a home is 37.7% cheaper than renting. Rates would need to increase over 100% to cancel out the long-term cost savings of buying, an increase that is extremely unlikely.
Other reasons to purchase a home now include mortgage and property tax deductions, a “price lock” on your monthly home payments with fixed-rate mortgages (versus rents that always climb upward), and a solid asset in your financial portfolio.
Your Home Buying Prep Checklist
Buying a home is exciting, but it can also be overwhelming and stressful if you aren’t fully prepared for the experience. If you’re ready to purchase a home, make sure to get your ducks in a row, so that you can manage your expectations.
- Examine Your Credit Report – Your credit score will have an impact on how much you can borrow and at what rate. Pull a free copy of your credit report from each of the big three reporting firms. If you have a low score, take a year to pay down debt and make on-time payments to help improve your number.
- Understand Your Budget – A major component of the housing crisis of 2008 involved a lot of people buying homes they couldn’t actually afford. It is important for your financial health to buy a home that you can afford today. Get a pre-approval letter, but work with a mortgage calculator to understand just what your monthly payments would be.
- Get Your Paperwork in Order – When it comes time to apply for a mortgage, you’ll need to have copies of pay stubs, bank statements and income tax returns. Pull recent copies of each so that you have them on hand when the time comes.
- Shop For A Mortgage – Many people choose to work with the bank they use for checking and savings, but it will serve you well to shop around for the best rate possible. Fractions of a percentage of interest do add up over time.
The right professionals can make the home buying process a smooth, successful experience for first-time homebuyers. If your company is looking for underwriting or finance talent, or if you are a mortgage professional seeking new opportunities, contact the expert recruiters at Contemporary Staffing Solutions today.