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First Time Home Buyer: Success Guide

May 13, 2019 by Fred
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When buying your first home, information is your key to success. This article answers some of the most important and common questions for a first time home buyer.

Our success guide for a first time home buyer answers these questions:

 

Where do I get started?

The best place to get started is to get pre approved for a mortgage loan. Pre approval for financing helps you understand the flexibility of your home buying budget and gives you the opportunity to address any potential financial concerns before you make an offer. With a lender’s official pre approval letter, your offer on a home shows the sellers that you are serious and ready to buy.

Being connected to a licensed mortgage consultant is an excellent way to ensure success as a first time home buyer. At TexasLending.com we are happy to be your mortgage experts and help you answer any questions during the home buying process.

Our mortgage ready checklist can help you understand more about qualifying for a mortgage loan and how to be prepared for beginning the home buying process.

Mortgage Ready Checklist

 

How much home can I afford?

If you are currently renting an apartment or home, you probably know how much you can afford to pay towards a monthly mortgage payment, based on your current rent. What you may not know is how to estimate your monthly mortgage payment based on the price of a home. That is where we can help.

If you are looking for a simple calculation to estimate potential home prices, you can use these formulas:

  • House Hold Income   x    3.25    =    Target Home Price
  • House Hold Income   x    4.50    =    Maximum Budget

While these calculations are the easiest way to get an estimated idea of potential home prices, your true budget is more complex.

Having a conversation with a licensed mortgage consultant about your income, savings, and current expenses is the best way to get the most accurate assessment of what you can afford. Our mortgage consultants have up to date knowledge of the current mortgage guidelines, and can give you a wealth of information about your home loan options.

 

How much should save for the down payment?

At TexasLending.com we have different loan options available for potential home buyers, each with different advantages. Calculating your down payment can be helpful to you as a first time home buyer.

These are the down payment options for available loan programs:

  • FHA Home Loan: 3.5% down payment
  • First Time Home Buyer Conventional Loan: 3% down payment
  • Conventional Home Loan: 5% down payment
  • USDA Home Loan: (Rural Home):0% down payment
  • VA Home Loan: (U.S. Veterans): 0% down payment
  • Non-QM Loan: 10% down payment

We would also encourage you to consider saving for moving costs, utility set-up, buying appliances after closing, and other expenses you may have as a first time home buyer.

Use our down payment saving plan worksheet to help you organize your thoughts on saving for buying your first home.

Down Payment Savings Plan

 

What should my credit score be?

At TexasLending.com we have different loan options available for potential home buyers, each with different credit score requirements.

These are the current credit limits for mortgage loan programs available at TexasLending:

  • FHA Home Loan: 580 minimum credit score
  • Conventional Home Loan: 620 minimum credit score
  • USDA Home Loan: (Rural Home): 640 minimum credit score
  • VA Home Loan: (U.S. Veterans): 620 minimum credit score
  • Non-QM Loan: 540 minimum credit score

You should also keep in mind that having a score above 740 will help you get the best interest rate for your loan type.

Learn more about Credit Scores and Home Buying in this article.

 

Where can I find a quality Realtor?

At Texas Lending we have helped thousands of home buyers purchase the homes of their dreams. That also means that we have worked with thousands of realtors, and we know which realtors provide the best experience to their customers. A top quality realtor should have experience and keep you well informed. They will efficiently guide you in finding the right home, making a smart offer, and help you negotiate the purchase contract with the seller.

 

We love helping first time home buyers reach their goal of becoming home owners. Reach out to us any time with your mortgage questions at TexasLending.com.

 
 

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Current Rates

 

Conventional Refinance
15 Yr. Fixed

As of: October 12, 2018

4.25%
RATE
4.353%
APR

Conventional Refinance
30 Yr. Fixed

As of: October 12, 2018

4.875%
RATE
4.949%
APR

VA Home Loan
30 Yr. Fixed

As of: October 12, 2018

5.000%
RATE
5.199%
APR

FHA
30 Yr. Fixed

As of: October 12, 2018

4.75%
RATE
5.534%
APR

FHA
15 Yr. Fixed

As of: October 12, 2018

4.25%
RATE
5.098%
APR
 
 
 

 

 
 

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