10 Ways to Prepare for Home Ownership
Whether you are just starting out or starting over, preparing to buy a home can be overwhelming. Here Realtor® magazine breaks down preparing to own a home in 10 manageable steps.
- Decide what you can afford. Most people target two to three times their gross annual income as a benchmark.
- Develop your home wish list. Prioritize features on the list.
- Choose your location. Start with three or four neighborhoods that interest you.
- Start saving. Banks ideally want 20% of the purchase price as a down payment, but this varies. [FHA minimum down is 3.5% And in this buyer’s market I can usually get the buyer’s closing costs paid… approx. 3%, typically] In addition, you’ll want to plan for closing costs which range from 2 to 7% of the home’s price.
- Know your credit score and correct any credit errors.*
- Determine how much of a mortgage you qualify for.*
- Get pre-approved by a lender.*
- Consider other sources to help with the down payment (borrow from family, government or down payment assistance programs, retirement plan savings, etc.).
- Calculate the costs of homeownership. Include your mortgage, property taxes, insurance, maintenance, utilities, association fees, etc. to set an accurate estimate.
- Select an experienced Realtor® to guide you through the process.
*Your lender can help with items #5, 6 and 7 above. Not sure where to begin? Contact me. I’d be happy to provide a referral to a lender that fits your situation.
And, of course, if you questions about ANY of these steps, please contact me. I’m happy to help.
Working for you,
Named “Best of Kent” Realtor 2008, 2009 & 2010
Named “Five Star Real Estate Agent” by Seattle Magazine