You want to buy your first home, but you’re worried that student loan debt or a low bank account balance could hold you back. The good news is that there are a variety of loan options available to you. You’ll want to gather some paperwork and documents first to help make the process easier for you along the way.
Check your credit report
Before you start the home buying process, you’ll want to check your credit score. In fact, make this the first thing you do. Credit is the single most important factor a lender looks at when determining approval of a mortgage. There are several credit scoring agencies that provide free credit reports. Resist the urge to open or close accounts during this period before consulting your lender.
Get a pre-approval letter
With your credit score in hand, you’ll want to next ask for a pre-approval letter from a mortgage lender. A lender will examine your income, your credit score, your monthly debt obligations and other financial information to determine whether you qualify for a home loan. A pre-approval essentially means a lender has done all that for you already.
Find a great local realtor
Now that you’ve got your credit report and pre-approval taken care of, it’s time to scope out homes. But first, find yourself a local realtor who’s knowledgeable of the neighborhoods you’re looking to buy in and that you can trust. They’ll be your best ally going forward and make the process much easier for you.