Santa Fe Homes Blog

Every American has their own “American dream” as to the type of home they would love to own. When the time is right to buy that first home, you should first consider these mortgage tips for first time home buyers:

1) Pay Your Debts First
If you have money you have saved to buy a home, you may first want to consider paying off your debts (which will help you better afford a mortgage). Debts include bank loans, outstanding credit card balance, unpaid bills, etc. By first eliminating your debts, you will build a better financial portfolio for yourself, which could result in a better rate for you when borrowing money to finance your first time home.

2) Determine Your Realistic Financial Position
As a first time home buyer, your main two financial concerns are the amount of money you can put down on a home and the amount of money you have to borrow to pay the remaining balance. As a rule of thumb, the amount you have to pay in mortgage costs should never exceed 28% of your annual income. Keep this in mind when determining the type of home you can afford. Also, remember that the more you put down, the better mortgage deal you can generally get. Make sure you have a nice sum for your down payment.

3) Government and Private Lenders
Freddie Mac and Fannie Mae are examples of government-sponsored institutions that can help you obtain a home loan at a very attractive price. Also, many private lenders offer incentives and more attractive packages to first time home buyers. So be sure to use the fact that you’re a first time home buyer to your advantage! A third option for financing your home is going to your bank and applying for a mortgage loan. If you are the member of a credit union, they may also have very attractive offers.

4) Real Estate Shopping
If you got all your finances all figured out, then you can start shopping for you house. The first thing to do is to get in touch with a reliable real estate agent that can show you a number of options. It is important to choose the right neighborhood for you and your family. Make a quick wish list of the things you want and use this as a reference before you purchase a property. It is important that you personally inspect each house that you are looking at buying.

5) Making an Offer
Once you have your finances in order you can use a real estate agent to find that perfect home that fits within your budget parameters. And be sure to have budget parameters! Your real estate agent will act in your best interest when making an offer and negotiating with the seller. Don’t be afraid to ask your real estate agent about things you don’t understand. When a price is agreed upon and a contract drawn up (that you’ll carefully read), then you are well on your way to putting the term “first time home buyer” behind you.

Congratulations on your first home!

Tags: Real Estate Tips //