Homebuying tips

What can you do to plan for your future home purchase? Saving early, strengthening your credit score, calculating what you can afford and choosing the right mortgage advisor to guide you are tips that will set you up for success in buying your first home.

Know your numbers

Pre-qualification is an excellent starting point when you’re unsure if you’re financially ready to buy a home. By taking a few minutes to enter basic financial information into a mortgage affordability calculator, you’ll get a general idea of how much you can comfortably afford to spend.

Homebuying tip: Pre-qualification doesn’t mean you’re approved for a home loan. It’s intended to help you decide if you’re ready to move forward with your loan application.

Boost your savings

If owning a home is an important long-term goal, saving money now for a down payment later can help you get there. A down payment on a home is helpful for several reasons:

It can help you reduce the amount you have to borrow. A larger down payment means you will have a smaller mortgage, which can result in lower monthly payments and less interest paid over the life of the loan.
You may qualify for a lower interest rate when you put more money toward your down payment.
When you make a down payment, you immediately start building home equity.

The road to saving for a down payment begins with making a budget and sticking to it. By creating a spending plan, you’ll know how much you can set aside each month for a down payment while still having enough left for necessities. Once you’ve built your budget, set a specific and realistic monthly down payment savings goal.

Homebuying tip: Have you heard the myth that you must put down a minimum of 20 percent? The truth is, there is no standard down payment amount. Some mortgage programs include low or no down payment options so you can choose the best mortgage and down payment amount for your financial situation.

Check your credit

Your credit score is calculated based on the information in your credit reports. A credit report includes your credit and loan accounts, account balances, payment history, credit inquiries and public record information such as bankruptcies. All this information on your borrowing and repayment history shows how you manage credit, which is essential when applying for a mortgage. Therefore, the first step to improving your credit score is to learn how to read your credit reports.

Homebuying tip: Credit scores aren’t set in stone. Taking action to improve your credit score now can boost your chances of being approved for a home loan in the future. Ways to increase your credit score include making payments on time, setting up autopay for your bills and fixing incomplete or inaccurate information in your reports.

Talk to a mortgage professional and get preapproved

Preapproval helps you find a price range for your home search and targets how much you should save for a down payment. In addition, because the mortgage preapproval process includes submitting a loan application and securing financing, it can accelerate the closing process.

Your loan officer will treat you as a top priority through the preapproval and mortgage loan process. Knowing there’s a local mortgage lending team just around the corner living and working in your community can be reassuring. If you need to speak with an expert, you can contact your team directly by phone, email, text or face-to-face.

Homebuying tip: The home you can afford may cost less than your maximum preapproved loan amount. In addition to your down payment and closing costs, you’ll want to set aside money for additional homebuying expenses like property taxes, maintenance and potentially HOA fees.

Choose the right mortgage for your needs

During preapproval, your loan officer will guide you in selecting a mortgage program. We provide a wide array of home loans, allowing our loan officers to find the loan that fits your life.

In addition to our conventional, FHA, VA and USDA financing options for first-time homebuyers, military families and rural residents, we offer reverse mortgages, jumbo and manufactured home loans. The right home loan for you may also be one of our more customized financing options.

Homebuying tip: A mortgage rate lock can provide predictability as you plan. Our Lock and Shop program protects your interest rate for 120 days while you search for a home.* If rates go down, you can take advantage of our one-time float-down option.

Apply for down payment assistance programs

With down payment assistance (DPA) programs, you could be a homeowner sooner than you may think. Widely available DPAs are designed for homebuyers who can afford monthly mortgage payments but don’t have enough savings for a down payment.

They’re available at the state or local government level and offer first-time homebuyers relief from the initial home purchase cost. As a result, you can start the journey to homeownership without waiting to save. In addition, if the assistance is provided as a grant, it’s often forgiven over time.

Homebuying tip: Depending on your local housing agency’s requirements, you may still qualify as a first-time homebuyer even if you’ve previously owned a home. For example, if you haven’t owned a home in three years, you’re a divorced or separated parent or your property was damaged.

Find the right home for you

There are millions of homes for sale. So how do you find the right one for you and your family? The key to getting the best fit is to identify your priorities. First, create your must-have wish list of home features and abide by those guidelines.

Then, discuss your preferences with your real estate agent who will help narrow your options. Finally, attend open houses in your desired neighborhoods to get a sense of what’s selling and how a home in your price range might compare to others in the area.

Homebuying tip: Because no home is perfect, your ideal home may be a fixer-upper that you can expand or renovate to suit your needs in the future. Consider a renovation loan that allows you to purchase a home in almost any condition, start home improvements right away and pay for them over time by consolidating the cost to buy with the estimated remodeling costs.

Make an offer

Real estate agents can access information about what other homes have sold for in the area to ensure you don’t spend more than necessary. You can also research the home listing to determine how long it’s been on the market. If it’s been on the market for months, there may be room to negotiate a lower offer.

Typically, your agent will write your offer as a purchase and sale contract and submit it to the seller’s agent, who will present it to the seller. You’ll likely hear if your offer is accepted within a few days. If the seller makes a counteroffer, you can accept, decline or counter the offer.

Homebuying tip: In the home price negotiation process, the seller may ask you for concessions. Some concessions can help you reach a deal on the home you want, but if asked, waiving the home inspection contingency is not recommended. A home inspection is done to expose issues before closing and can also increase your confidence about a home’s condition.

When should I talk to a mortgage professional?

It’s never too early to reach out to a loan officer about your homeownership goals. Our loan officers will use their expertise to guide you throughout the homebuying process when you’re ready. Connect with a loan officer at your local branch to learn more.

*Upfront lock-in fee required at the time of lock.

The above information is for educational purposes only. All information, loan programs and interest rates are subject to change without notice. All loans are subject to underwriter approval. Terms and conditions apply. Always consult an accountant or tax advisor for full eligibility requirements on tax deductions.