BUYING IN 2018_ 7 STEPS TO TAKE NOW

BUYING IN
2018? 7 STEPS
TO TAKE NOW
Sources:
https://www.trulia.com/
https://artesiantitle.com/

credit score is a numerical representation of your credit report. FICO scores range from 300 to 850, and
A
higher your score, the better. “Good credit is like gold when obtaining a mortgage,” says Denise
the
a Pennsylvania agent. Typically, you’ll get the best interest rate on a loan if your score is 740 and
Supplee,
“A higher credit score should net you a lower mortgage rate,” says Lee Gimpel, co-creator of The
above.
Credit Game, which specializes in financial education. “That lower rate, even if it’s only 1 or 2
Good
lower, can mean saving thousands of dollars per year.” If your credit score falls short, get busy
percent
it. Correct any errors that might be on your report, start paying all your bills on time, and get your
repairing
limit raised. Note, though, that you shouldn’t max out your card each month. It’s best to use 30
credit
you think resisting taking a selfie when you’re
If
with your fave celebrity is a
face-to-face
to your willpower, that’s sissy stuff
testament
with turning down every offer to open
compared
credit card, even if you could save 20 percent
a
more!) on your holiday purchases. Tempting
(or
saving at checkout can be, opening new
as
may hurt your chances of getting a
credit
or at least of getting the best rate on a
mortgage,
loan.
opening the account, you have created
“By
line of credit,” says Paul Anastos,
another
of Mortgage Master, a division of
president
a nonbank lender. “That credit line,
loanDepot,
what is borrowed, can change the
and
numbers and jeopardize the
application
application.” What could save you a few dollars
could cost you far more in the long run if
now
mortgage payments will be higher. And
your
those same lines, “Don’t overspend
along
the holiday season,”
during
the mortgage loan, you’ll need a sizable
Besides
of cash to buy a house. There’s the down
amount
to consider, closing costs, and moving
payment
You should also set aside money for
costs.
repairs and costs, says Brian Betzler,
unexpected
sales manager at TD Bank. Not being
regional
“is probably why nearly half of
prepared
incurred up to $5,000 in unexpected
millennials
during the mortgage process, according to
costs
TD survey,” he says.
a
potential solution? Bulk up that emergency
A
“Instead of getting gifts for the holidays,
fund.
homebuyers] can suggest cash
[prospective
that will be put toward their home,” says
instead
Sian, a Kentucky and Ohio agent. And
Paul
you might be getting some money
remember,
after you file your tax return. Don’t blow it on
back
“A tax refund is a great way to add to
vacation.
cash reserves for a down payment,” says
your
Hosterman, branch manager of Castle &
David
1. Check your credit score.
percent or less of your total available credit.
2. Don’t open new credit cards.
3. Suggest financial gifts for the holidays.
Cooke Mortgage in Colorado.

your neighbor, relative, or friend of a friend
If
to know (or is) a real estate agent, that’s
happens
This person might be the perfect agent for
great.
But you owe it to yourself to shop around.
you.
for [an agent] who is knowledgeable,
“Look
integral, and can assist you in reaching
good,
goal of homeownership,” says Chantay
the
a Los Angeles, CA, real estate agent.
Bridges,
sure they are not a novice, new, or just
“Make
of how to do a specific transaction.”
unaware
end of the year is usually a slow time for
The
so chances are they’ll be more
agents,
to making an appointment on
accommodating
schedule.
your
you even start looking for a home (and yes,
Before
even mean browsing online listings), look for a
we
lender to find out if you can afford to buy
mortgage
home. If you can’t right now, there’s no use
a
yourself by finding your dream home
torturing
just out of reach. But how do you find a
that’s
“If you have a bank you’ve been with for
lender?
ask them,” says Bridges. “Your [real estate
years,
agent] can also refer a good lender to you. Compare
lender] with two others. Look at what they
[that
costs, points, and how long to close.” Once
offer,
know how much home you can afford, perform
you
home search based on your preapproval
your
you hear that interest rates are at historic lows or
If
interest rates are on the rise, you should not
that
that you can get the rock-bottom rate. Not
assume
gets the same interest rate on a mortgage
everyone
It depends on your financial picture and on
loan.
lender you choose. “Everyone knows that
the
prices are, at least to some extent,
home
but we find loans to be the same,” says
negotiable,
shop around for the lowest interest
homebuyers
Note that closing costs can vary too, so
rates.
with your real estate agent ways to keep
discuss
down. “We saved $150 on the closing fees
yours
selecting the cheapest title company,” says
by
“I guess that’s not much, but I think most
Ward.
would bend over to pick up three $50 bills
people
they were lying on the sidewalk.”
if
a lender gives your financials the once-over
When
preapproves you for a mortgage, you’ll be able
and
show sellers that you really can buy their house.
to
how do you get preapproved? By preparing a
But
documents, which you can do several months
few
advance of the actual purchase. Here’s what you
in
returns for the past two years
Tax
forms for the past two years
W-2
stubs from the past few months
Paycheck
of mortgage or rent payments for the past
Proof
year
list of all your debts, including credit cards,
A
loans, auto loans, and alimony
student
list of all your assets, including bank statements,
A
4. Interview potential real estate agents.
5. Keep tabs on interest rates.
Ward, CFP with WWA Planning &
Warren
in Indiana. He advises that
Investments
7. Get preapproved.
need to buy a house.
6. Find a mortgage lender.
auto titles, real estate, and any investment accounts
amount or less.