Buying a home is a very intense and demanding process. If it is the first time you’ve ever purchased a home, it can definitely be very overwhelming, confusing, and you will probably feel lost at some point during the process. There are many parts when it comes to purchasing a home, but today I want to focus on one aspect of it: the financial part. Today, I want to share with you a couple of tips that will help you learn how to become financially prepared for a home purchase. There are many things that first-time homeowners are not aware of, so this is very important to read and know before you consider buying your first home. Here are my tips:
Start Saving
Before you even think about the ins and outs of buying a home, you need to start saving your money. Nerd Wallet says, “Lenders like 20% down payments. That’s $60,000 on a $300,000 home. For one thing, you’ll probably procure a superior home loan financing cost. There is a wide range of different advantages as well:
- Lower forthright expenses (we'll talk progressively about that in a second)
- Lower progressing expenses (more on that as well)
- Greater value in your home immediately
- A lower regularly scheduled installment
Of course, there is one major, succulent admonition: The initial installment isn't the main forthright cash you need to manage. There are credit shutting expenses and sincere cash to consider too. Before the emotional music restores, we should investigate some drop initial installment choices.”
When I purchased my home, I actually did not have 20% to put down and it was okay! A lot of people think that you have to have 20% or you cannot purchase a home, which is not true. Sure, 20% is the smart way to do it, but it is do-able without. In fact, you can actually purchase a home with as little as 3% down. The catch is that you will have a PMI (commonly known as private mortgage insurance), which can be a good chunk of your monthly payment going forward. Once you get 20% equity into the house, you can refinance to take the PMI off, but you will, unfortunately, have to wait until then.
Because of the hefty down payment, you will most likely make, as well as other closing costs and fees, you will need to have a good chunk of savings in your pocket, ready to go before you even consider closing on a home.
Keep Your Job
This seems very straight-forward and honestly, it is, but a lot of people make the mistake of quitting their job to find a new one right before they want to purchase a home. To make yourself look the best, you need to have a great job history and being in a long-term job when you apply for a loan honestly just looks the best for you. Of course, once again, it is possible to get a home loan if you just switched jobs: it might just require more questions answered and more paperwork.
Get Rid of High-Interest Credit Card Debt
High-interest credit card debt will only hurt you during the process of buying a home, so consider trading out your high-interest debt for a collateral loan from Chapes-JPL. Why would you consider a collateral loan from Chapes-JPL? For starters, the process is very simple and straightforward. They loan strictly on collateral, so there are no credit checks involved and most loans are completed within a few minutes, instead of the typical days or weeks with traditional loans (think about with a house loan - it takes a MINIMUM of 30 days). Chapes-JPL provides short-term loans, but you can extend the loan to be longer-term if you need to. Using their services is a fantastic way to not only reduce your credit card debt by putting the money you get from your collateral loan towards paying off your high-interest debt, but it is also a great way to help you save for a down payment, as well, especially if you have jewelry or other valuables to sell.
Chapes-JPL was established in 2980 as an alternative to banks and traditional pawnbrokers. They provide low-interest loans on gold, diamonds, jewelry, watches, and other valuable assets very quickly. They buy and loan in their private and upscale office in Atlanta, Georgia and they service over 18,000 customers nationwide.
Get Pre-Approved
Before you start looking at homes (especially in person!), get pre-approved and make sure you do not look for homes that are at the top of your budget. Why? Because people who do this typically become quote on quote house broke over the years. Owning a home is expensive, so make sure that once you do get pre-approved, you also talk to your lender about what a smart cap is for your specific circumstances. Once you get pre-approved and create a budget for yourself, you can start shopping for your house! The reason why it’s so important to get pre-approved before looking at homes is because you do not want to get your hopes up by looking at homes that are above your budget range and in addition to that, the housing market is pretty competitive and in order to have the best chances of getting the home you want, you want to make the process as seamless as possible by already being pre-approved from a lender.
Do Not Make Any Big Purchases
This is the best advice I could possibly give you. Do not, do not, do not make any large purchases during the closing process. Once you get approved for your final loan, you might think you are in the clear, but do not be fooled - they can change it up on you just days or hours before your actual closing. If you have to buy anything such as a washer and dryer, etc. please wait until you sign your closing papers and the key is in your hand! This is so important to remember!
