Tips for First Time Home Buyers
12/19/2018
Devon Feldpausch
New home in the country

Buying your first home is an exciting time but can also be full of unknowns. Devon Feldpausch, from GreenStone Farm Credit Services, provides some tips for first time home buyers in the video below.

 

First: Find the right lender 
Selecting the right lender requires a bit of research and knowing the factors that are important to you. While interest rates are often the driver of the decision there are other factors such as fees, locations, willingness to work with non-traditional properties and the people you will work with. Local realtors and other recent homebuyers are often good sources of reference for lending options.

Second: Check your credit report and work to improve it or keep it stable
Knowing your credit rating will give you an idea of the type of rate you may be eligible for. Once you know your rating, be sure to not do nay activity such as late payments, or excessive credit card balances which will affect your score. You can, however do things to improve your score such as paying down debt and cleaning up any late or missing payments.

Third: Know your down payment options
Be sure to check with your lender on what your down payment options are. Do you need a full 20 percent down in cash? Is there an opportunity to use PMI or a short-term loan to offset the down payment requirement? Most time lenders have options for borrowers in meeting down payment criteria.

Fourth: Determine your budget
Knowing how much you can afford in a house payment, is often times different than what you are preapproved for. Establish a household budget so you know the appropriate price range of your new home.

You may also want to consider bi-weekly payments as a way to lower the amount of overall interest you will pay over the life of the mortgage and can cut 6 years off a 30-year mortgage.

Five: Obtain Life Insurance
Some lenders may require you to have life insurance at a value sufficient to cover the mortgage. Regardless, life insurance is important in ensuring your family’s future in the event of a tragedy.



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