For first-time homebuyers, emotions often run high due to the significance attached to the decision to purchase a home. On one hand, people are excited about embarking on this new chapter in their lives. On the other hand, it can be scary to make such an important financial decision. To ensure that your first-time buying experience is as stress-free and straightforward as possible, we’re here with a few pieces of advice.
Find a Professional
Before you embark on one of the biggest financial undertakings of your life, it is beneficial to find a professional that can support you. There are many dedicated mortgage loan officers, who work hard every day for their clients. Canvas Mortgage, a Merchants and Marine Bank subsidiary company, is one that is there for you. In addition to advising you on many financing options, they can educate you on other confusing aspects of the home buying process such as changing interest rates, knowing your true credit score, and working with other professionals like realtors, insurance agents, inspectors, title companies, and real estate attorneys.
Some of their greatest value is saving you time out the gate by being able to help you uncover and understand your credit.
Check Your Credit Score
It is good to do some of your own legwork before speaking with a professional like pulling your credit reports and scores online. Take a good look through the information to identify any errors, past-due accounts, or other items that may negatively impact your ability to secure a favorable mortgage loan rate. Here is where you can ask your mortgage advisor what you need to do to position yourself for the best rates. They may be able to shed additional light into your unique situation and how to be competitive with your credit. A professional may be able to see additional information about your credit and understand why you do or do not qualify for different rates.
A few great online services you can explore to research your credit are Annual Credit Report, Experian, Equifax, and TransUnion.
Don’t Trust Mortgage Calculators
It can be tempting to plug your income into a mortgage calculator and blindly accept the value it generates. While mortgage calculators are useful, they won’t give you the whole picture when it comes to your finances. For example, many calculators will not consider your monthly expenses, such as electricity, food, medicine, contributions to your savings, clothing, vacations, allowances for children and pet care.
Even if your monthly income is high, large monthly expenses will mean the amount leftover to purchase a home will be lower than what the calculator has expressed. It’s best to create a detailed budget that shows the money coming in and going out of your household. Ideally, you should create this budget over the course of 2 to 4 months so that you can get an accurate representation of how much your spending varies month to month.
We advise you know the facts so you can be confident in your choice of how much you want to borrow and pay every month. A professional will help you untangle fact from fiction when it comes to the true monthly cost of a home and can help you make sure you avoid being “house poor.” Mortgage calculators can display only part of the picture of what will be owed. A professional can help you make sure your payment is not overwhelming your ability to comfortably manage household expenses, savings goals, and other monthly debts such as car payments and student loans.
Do Your Own Research
Once you’ve determined the ideal budget for your home and found a professional to help you on your journey, it’s time to start house hunting. Here are a few key elements to consider when finding your dream home:
● Is the price reasonable for the neighborhood? Check out the prices nearby and make sure your home’s value can grow from this starting price.
● Is it in a good school district? Even if you don’t have children right now, you’ll thank yourself later for checking the quality of the schools.
● Is the neighborhood safe? It’s a good idea to drive around the area at different times to determine how safe things are in the morning, afternoon, and evening.
Finally, just try to imagine yourself in your potential new home. Does the location allow you to live inside what we like to call your “logistics circle?” Can you comfortably travel to your work and community commitments, day in and day out? How far away will you be from your workplace, your friends, your church, or any other activities or amenities you enjoy. Make sure that dream home doesn’t cause you nightmares somewhere else in your life.
We’re here for you!
The amount of predatory mortgage lenders out there is significant. There’s a lot of money to be made on first-time homebuyers who might not have a thorough understanding of the lending process. If you’re looking for caring service, competitive rates, and expert advice regarding the complex world of mortgages, we are here for you. Contact Canvas Mortgage for help finding a mortgage professional. As a division of Merchants & Marine Bank, our team at Canvas Mortgage provides the same level of excellence you expect from your personal banker. They’ll walk you through every step to ensure you’re getting the best deal possible on the largest purchase of your lifetime.