Thinking about buying your first home in the next year or two but you’re not sure how to begin preparing for it? I’m Amy Clark, your home loan expert at PCCU and I’ve got a simple checklist for you.
First, pull copies of your credit reports from AnnualCreditReport.com. You can see if you have any outstanding issues hiding on your credit report that need to be addressed, like medical debts. You can use the contact information on the report to follow up with any creditors reporting unresolved issues and get them cleared up. Be aware that each bureau will only show you your report for free; if you want to see your score, you’ll have to have to pay the bureaus for it. You can learn more about credit reports and scores here at our free Financial Literacy Center.
Second, get your budget in order. If you don’t already have a monthly budget, now is the perfect time to create one and practice sticking to it. We have a free budget coaching session at our Financial Literacy Center. Having a budget will also make the next step easier.
Third, begin saving money to pay application fees and your eventual down payment. While there are home loan programs where you can make a small down payment, or even skip it all together, you’ll still need money for things like application fees, an appraisal, and home inspections. Plus, the more money you can bring to the purchase, the more options you’ll have as a buyer.
Finally, start thinking about the town and/or neighborhood where you might like to buy your first home. You can check out the area through different seasons and see if there are factors you might not spot at certain times of the year. For example, a creek that runs to trickle in late summer or early autumn might be swollen with spring rains and require the added expense of flood insurance; or the barnyard nearby might be tolerable in January, but smell quite strongly in July. Old growth shade trees look pretty on a sunny day, but how do they look after a storm sweeps through? Take a critical look at the area you’re considering and make sure you’re not getting more than you bargained for.
It can be a lot to consider, but the sooner you start, the sooner you’ll be ready to make the leap into home ownership. As your home loan specialist I’m happy to help you through any or all of these steps along the way. Feel free to email or call me at 765-960-8618, I’ll answer your questions and be your guide all the way through the purchase and beyond.
First Time Home Buyer Preparation Checklist
Pull your credit report and clear up any issues
Create or tighten up your budget
Start saving money
Think about where you want to live and make regular visits