If you're thinking about buying a home, it's important to know what to expect.
Mortgage rates fell to record lows in 2020, and the demand for homes remains strong. However, in most parts of the country, the inventory of available houses is still low. This means that many homebuyers are facing stiff competition from other motivated buyers.
Even though it's a seller's market, that shouldn't stop you from buying a home you love. It just means you'll need to be well-prepared so you can act fast when you find the right home!
Get ready to buy a home this spring with these tips:
Do a credit check-up
Your credit can make a big difference in your home financing options. Lenders look at your credit score (and other factors) to set your mortgage loan pricing and interest rate. The higher your credit score, the better!
Before applying for a mortgage, check your credit reports to make sure everything is accurate. You can request a free credit report from each of the three major credit bureaus — Equifax, Experian and TransUnion — at AnnualCreditReport.com.
You can get your credit score directly from FICO as well. If you have a credit card, the credit card company may also provide free access to your credit score. If your score isn't where you want it to be, consider taking steps to raise your credit score before buying a home.
Have a down payment ready
Before you start looking for homes, decide how much you want to put towards a down payment. The larger your down payment, the less you'll need to borrow and the less interest you'll pay on your loan. Your mortgage lender will help you compare your options and find the mortgage that's right for you!
Along with a down payment, you will need to factor in the closing costs. You may also want to set money aside for home maintenance, repairs and new furniture for your home.
Get pre-approved for a mortgage
In today's competitive market, timing is everything. It's important to be able to put in an offer quickly when you find a home you want. This means you'll want to have your financing in order before house-hunting.
Getting pre-approved will help you understand what your home buying budget is, so you can move forward with confidence when you find a home you like. A mortgage pre-approval is also attractive to sellers because it shows that you're serious about buying a home. If you want a potential edge over other buyers, talk to your mortgage lender early!
Go into the spring homebuying season with confidence!
When buying a home in a competitive seller's market, you want to find a lender you can depend on to make the mortgage process as smooth and easy as possible. At Wright-Patt Credit Union (WPCU), our friendly, knowledgeable Mortgage Loan Originators will be by your side every step of the way, from pre-approval to closing!
When you're ready to learn more about your mortgage loan options, contact one of our Mortgage Loan Originators. We're here to help you borrow smarter and make the best decision for your situation.
For more helpful tips and advice on buying a home, including videos and interactive learning modules, check out our online Education Center.