Tips for First Time Home Buyers

Buying a home is one of the biggest decisions you will make. It is exciting dreaming about that perfect place where you can create countless memories for years to come. It would be nice if we could just snap our fingers and that perfect home would just appear, the process to get that mortgage was smooth sailing and have everything fall into place seamlessly. Unfortunately, the steps you need to take before getting that perfect home are not something a lot of us think much about. To save yourself a lot of complication and stress, there are things you need to consider before diving into the adventure of homeownership.

Here are some of the initial steps you should take to ensure that this process is a whole lot easier for you:

1) Check your credit score.

A history of consistently paying bills & debts on time gives lenders confidence that there is a low amount of risk to them and therefore can trust that you will be reliable in making your mortgage payments.

Ever wonder how your credit score is calculated and how to improve it?

The breakdown is as follows:

35% - Payment History

30% - Amounts Owing

15% - Length of Credit History

10% - New Credit

10% - Types of Credit

Did you know the higher your credit score, the higher potential you have in getting a lower interest rate?

For building your credit, here are some tips;

Pay off all outstanding collections

Make all payments on time

Regularly check your credit report

Reduce all balances on credit cards (don’t go over 35% if possible)

Budget (manage your finances)

Your credit score is a piece of your financial puzzle that is super important and will dramatically affect your borrowing options so it’s worth putting the effort in looking for ways to improve it.

2) Save, save, save!

Review your budget and start saving for a down payment & extra for closing costs (Average closing costs for the buyer run between 0.5% - 1.5% of the purchase price).

Also note, mortgage insurance is required if you put less than 20% down. This insurance protects the lender against mortgage default and also allows the borrower to put as little as 5% down. These premiums are normally added into the monthly mortgage payments.

3) Connect with a mortgage broker (namely, me!) and talk about what your house goals are and what you will potentially qualify for (Apply online at https://alicia-sharkawi.mtg-app.com).

What are the benefits of using a mortgage broker?

I am here to act as the middleman between you & the lender.

I will explain the mortgage process, & help you find a tailored mortgage product to suit your specific needs, not just try to fit you into a box. I am available on your schedule, not banking hours, so feel free to reach out anytime. A mortgage broker will save you time and money and the stress of having to figure this all out on your own. Also, did I mention my services to you are free! We are paid by the lender, not by you.

4) Get pre-approved!

Finding out what you are working with makes house hunting a lot less complicated and can simplify your search. This will also allow you to know what you can afford and what your monthly mortgage payments will look like.

When you get to the house hunting step, having a pre-approval in place will give the seller confidence, when you are making an offer. Showing them that you will be able to get financing for their property as well as your position as a serious buyer.

5) Start house hunting! This is the fun part!

As a mortgage broker, we work with some amazing realtors and if you are looking for one, we can provide you with some incredible options. Finding a realtor that you can trust with this important decision and has the knowledge to steer you towards that perfect home is vital.

Even though a home isn’t about the four, ten... or twenty walls around you, it is a place that reflects you and creates a space for memories to be built for years to come. I would love to be part of that special journey towards finding a place that you can truly call home in every sense of the word.

Alicia Sharkawi

Advanced Mortgage & Lending Solutions