Home buyers have lots of issues to face. There’s the task of finding the
perfect house, getting all the paperwork in place for a loan, paying for an
appraisal and other purchasing requirements, and jumping through a myriad of
other hoops. And all the while, all you really want is to reach the goal –
becoming a homeowner. For many home buyers, financing is the biggest hurdle.
There are some steps you can take to make this step easier.
Start by getting a copy of your credit report. You’re entitled to a free copy
every year at
www.annualcreditreport.com. This is a user-friendly
site that will guide you through the process of getting a report from each of
the three major credit-reporting companies, TransUnion, Equifax and Experian. As
a potential home buyer, having a copy of your credit report can help you in
several ways.
First, you can look for errors that may impact your ability to get a loan.
Nothing’s worse for a home buyer than to be turned down for a mortgage simply
because of a mistake on the credit report. You have the right to challenge any
information on your report and to require that the credit-reporting companies
make corrections, but it’s difficult to get past the fact that you’ve been
turned down for a home buyer loan.
Most lenders require that potential home buyers meet specific criteria in
order to qualify for their loan programs – especially those programs that offer
the best rates and terms. If you are hoping to purchase a home in the future and
have had credit issues, take charge of your credit now. Set up a budget you can
live with and make your payments on time, every time. Home buyers are
responsible for repaying a mortgage to a lender and they’ll look at your credit
history to determine whether you’re a good risk.
You should also do what you can to get positive marks on your credit report.
Take out a credit card or two, but no more. Don’t overextend yourself. As a
potential home buyer, you’ll be penalized for the amount you owe when you apply
for a mortgage – regardless of your ability to pay.
Start saving now. Even if you don’t expect to be a home buyer for the next
several years, having a sizable down payment will help you get better rates and
terms on a home loan.
Note that home buyer grants are sometimes available. You may qualify for a
grant as a first time home buyer or for building or purchasing residential
property in certain areas. Realtors and lenders are usually “in the know” about
these kinds of programs, and that knowledge could be the boost you need to
become a home buyer.
Becoming a home buyer does take time and effort on your part. Keeping an eye
on your credit report, making sure that you’re making a positive impact on your
credit history, and saving toward the day you’ll be ready to buy can smooth the
process and make you a successful home buyer.
Finding the perfect house? That part of becoming a home buyer may call for
nothing more than a load of patience and some very comfortable walking shoes.
