The secret is out!!! Spencer and I are searching for a home. I have decided to take you all through our process with us. You will read about our ups and downs and the trumps and triumphs of this next chapter in our lives!
Buying a home is a very big decision and I have wanted to do this for over a year now. The timing just wasn’t right or there was just always something that came up that forced me to put this process off. But now, since I have been working my butt off, I have enough money for a down payment.
How We Made Our Decision:
I had a thought about a month ago that it is finally time. Looking at my savings, I knew there was enough saved to use for a down payment. I am sick of paying rent. I’ve always hated paying rent because it is literally like paying a mortgage. To me it’s not worth it to put all of this money into something that won’t be mine in the end. So Spencer and I had a very long and extensive conversation about what the right thing to do was. With our lease ending at the end of July, now is the time to start looking. We could have started earlier. But I would have had to pay so much money to break my lease and that is ridiculous!! Paying a mortgage and my rent at the same time also isn’t feasible either if I don’t break my lease. It normally takes about 30-60 days to close on a home so we knew that we had to start now in order for the process to fall into place about a month before our lease ends.
Where to Start:
I reached out to a handful of banks, mostly credit unions, I knew I would get a better interest rate from them. I stayed away from big, known name banks like Citizens Bank or Bank of America. We discussed the option of being a first-time home buyer and what the benefits were of using this option. And for me as much as I would have loved to go with the 30-year fixed-rate mortgage, we didn’t have quite enough money for a down payment for that type of loan. So we went with first-time home buyer loan. With this option we were able to have a down payment starting as low as 3%. After talking to a few banks, going over how much we would get approved for and what interest rate we would qualify for we decided on the bank that worked best for us.
What to Do After You Choose a Bank For Your Home Loan:
So between having a great credit score, a decent down payment we were ready to make this next step. We filled out the loan application at the bank we chose. Make sure you read everything! This is a serious decision to make so you should not take reading the fine print lightly. This isn’t like reading the terms and agreements for an app you’re downloading on your phone. This is for a house! The biggest loan you will ever have!!!
It is Time to Find a Realtor:
Once we received our approval letter from the bank, we found a realtor! She is my moms best friend from high school. But all you need to do is ask around. So many people out there have realtors they can suggest just from people they know and word-of-mouth. You can always look up reviews to see what others are saying as well.
Your realtor will need proof of your approval letter. Once they receive it, you will be put on a mailing list where you will see all of the homes for sale that fit the criteria of what you are looking for in your home. This is when Spencer and I found the house we are currently interested in!!!
A Few Tips:
- Start saving now! The earlier you start the better. Look at your expenses and see what is a realistic amount for you to put aside each month.
- You also want to make sure you have a good credit score!! I use Credit Karma to keep track of how my score is doing. Make sure you pay your bills on time!!!
- I hate credit cards, but they help build your credit. So I have 2 credit cards and when I use them, I pay them off in the same month. One of my credit cards is a Discover card and what is nice about using Discover is that I can view my FICO credit score which is what banks want to know!
- Banks also like to see that you working at a same job for 2 years minimum. It shows them that you have a steady income at the same company.
- If you qualify for a first-time home buyer loan, you will need to take a 3 hour first-time home buyer class.
- There are extra fees to keep in mind: inspection, realtor fee, money for renovations to fix small projects around the home, etc.
Stay tuned for my post next week! I will have more details to come with viewing the home and putting in an offer!!! I hoped you enjoyed reading about our first few experiences so far!!! ❤