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Things to Know for First Time Homebuyers

First Time Homebuyers in their First Home

Check Your Credit

When applying for a mortgage loan, your credit will be one of the key factors in whether you’re approved. It will help determine your interest rate and possibly the loan terms.Dispute any errors that could be dragging down your credit score and look for opportunities to improve your credit, such as making a dent in any outstanding debts. To keep your score from dropping after you apply for a mortgage, avoid opening any new credit accounts until your home loan closes.

Know What You Can Afford

Before you start looking for your dream home, you need to know what’s within your price range. Use this home affordability calculator to determine how much you can safely afford to spend.

Get a Pre-qualified Letter 

You can get pre-qualified for a mortgage, which simply gives you an estimate of how much a lender may be willing to lend based on your income and debts. But as you get closer to buying a home, it’s smart to get pre-qualified. Having a pre-qualified letter in hand makes you look much more serious to a seller and can give you an upper hand over buyers who haven’t taken this step.

Location vs Space

Unfortunately, we can’t have it all for the low prices we may feel are fair. You will have to decide what is most important to you before you start looking. A good location in a good neighborhood is going to cost you and it may not come with a remodeled or brand-new home at a price you can afford. This decision is totally personal, and it may be that you would rather have a small home and have the amenities of a vibrant city, or you may want a big home with a sprawling yard that is a drive to wherever you need to go. 

Don’t Commit Before You’re Ready

Owning a home is a huge commitment and a more expensive one than some homebuyers realize. Monthly housing expenses, for instance, can go from $1,300 a month as a renter to $2,200 a month as a homeowner. Before buying a home, make sure you know exactly what you’re getting into, so you can decide if you’re financially and personally ready for such a large commitment. In addition to your monthly mortgage payment, figure out how much you’ll be paying for property taxes, homeowner’s insurance, HOA fees and other monthly costs of owning a home.  

School Districts Have a Big Impact

Even if you don’t have kids, it pays to check out a neighborhood’s school district before buying a home, as living in an area with a sought-after school system raises your property value. A home in a good school district typically does well in resale. 

First Time Home Buyers Program at Solidarity

  • $750 Credit Applied To Your Closing Costs
  • As little as $1,000 out-of-pocket expenses
  • Home Buyer Education. 
  • A HomeReady loan is meant to help borrowers with low to moderate income buy or refinance a home by reducing the standard down payment and mortgage insurance requirements.
If you haven’t owned a home within the last three years, you may qualify for Solidarity's First Time Home Buyers Program!
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