Shopping for your first home and applying for your first mortgage? Below, we go over a few things to know about the process. As you will discover, you probably have more options for finding a flexible home loan than you realize.
Things You Should Know Before Buying Your First Home
- There is more than one type of mortgage. The very first thing you should know when you are looking for the right mortgage is that there are more types of home loans than you might be aware of. First time homebuyers sometimes only know that conventional mortgages exist, specifically conforming loans. But there are also jumbo loans, FHA loans, VA loans and USDA loans. Each of these products is suited to a different range of situations and offers unique benefits.
- You may not need a 20% down payment. When shopping for your first home, you might think that you can only purchase a home once you have saved up enough for a 20% down payment. There are cases when this mistaken belief might cause a family to delay purchasing a home for years. First time homebuyers can purchase properties with less than 20% down, however. VA, FHA and USDA loans in particular are great for these situations. But conventional loans also can have down payments lower than 20%.
- It is okay not to have perfect credit. As a first time home buyer, you also are mistaken if you think you need a perfect credit score to successfully apply for a mortgage. Government-backed loans like FHA, VA and USDA all have loose requirements for credit scores in comparison to conventional mortgages.
- Mortgage pre-approval can help you in your home search. Something else important to know about when you are shopping for your first home is the usefulness of mortgage pre-approval. Pre-approval is a rapid, easy process that allows you to receive a letter stating how much you qualify to borrow. Finding a home is much easier when you are aware of what you can afford. You can look for homes specifically in that price range. Plus, when you do find that ideal home, you will be more likely to be taken seriously when you make an offer if you have a pre-approval letter to show the seller.
- You can still raise your credit score. You might think that your current credit score is all you have to work with when you apply for your first mortgage. You are planning to move forward with the process as soon as possible, after all. But there may be enough time for you to make improvements to your credit before you submit your application, even if that is in the near future. There are a few tricks for giving your score a surprisingly quick boost. We can go over some ideas with you during your consultation.
- Buying your first home can be easy and fast. When you are at the beginning of the process of buying your first home, it may feel like you have a long, challenging journey ahead of you. But it could surprise you just how rapidly and easily you could complete the process with the right mortgage company walking you through it.
Buy Your First Home Now With Lake Mortgage
Now you know more about what to expect when you are buying your first home. Hopefully, this post cleared up some misapprehensions you might have had and shed some light on the process.
Mortgage pre-approval, a wide range of lending products, and a dedicated local company can make all the difference in the world when it comes to buying your first home.
Lake Mortgage has been working with first time homebuyers in Merrillville and throughout Indiana for more than 75 years. We are still supporting those same customers and their families and neighbors decades later. We look forward to helping you buy your first home and building the same kind of lifelong relationship with you so call us today at (219) 756-5626!