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By Helen Laskaris, Harvard University Employees Credit Union (HUECU) Mortgage Originator, NMLS #1370124
Buying a home is one of the most exciting financial decisions you’ll ever make – and it can also feel like one of the most complicated. Hunting for your first house is a big deal, but it doesn’t have to be difficult. If you’re thinking about taking the leap – or rather, settling down in a home you can call your own – check out this cheat sheet of 6 Things Every First-Time Home Buyer Should Know:
1. Start Saving ASAP
When’s the best time to start saving for a home? Right now. Get your financial plan on track today by mapping your income and expenses for one month. Once you have a clear idea of what you’re earning and what you’re spending, you can trim unnecessary expenditures (we’re looking at you, pumpkin lattes) and start building your down payment.
The average down payment is 10 to 20 percent of a home’s final price – but don’t let that figure scare you. First-time home buyers can often take advantage of loans designed especially for them, such as an FHA loan insured by the Federal Housing Administration that reduces down payments to 3 percent or lower.
3. Know The Score
A good credit score is one way of assuring lenders that if you get a loan, you’ll pay it back. Get a copy of your credit report and score before you begin applying for loans. That way, you’ll know what interest rates to expect or if you’re likely to be turned down – if your score is too low. If you don’t like what you see, improve your credit score by working with a financial planner to pay off debt.
4. Get Pre-Approved
In a competitive house-hunting market, home buyers can show that they are serious by getting pre-approved for a mortgage. Pre-approval lets a seller know that your credit is in good shape and that if you bid on a house and win, you’re ready to start paying for it. Reach out to your credit union to better understand how the pre-qualification process works.
5. Find Your Place
Before you consider what you want in a home, determine where you want to live. Walls can be repainted and knocked down, but the land you own is there to stay. Make a list of your needs now and in the future –schools, transportation, supermarkets and so on. Be sure to research upcoming city works projects and see how they might impact neighborhoods that interest you.
6. Don’t Do It All Alone
Buying a home is one of the most important financial decisions you’ll ever make so if you need help, just ask. The Harvard University Employees Credit Union (HUECU) offers members and their families the Real Estate Advantage Program(REAP) with a wealth of benefits including cash rebates and an initial consultation with a home loan advisor who can provide professional guidance throughout the entire process.
To learn more about buying a home, and the benefits that HUECU can offer to first-time home buyers, join the HUECU Spring Home Buying Forum. It’s happening on Saturday, April 9th, from 10 am to 2 pm at Radcliffe Yard, Knafel Center Gym, 10 Garden Street in Cambridge. We’re bringing in financial and real estate experts to talk tips – on saving for a down payment, getting approved for a mortgage, what to look for in your new home, how to submit an offer, moving services and lots more.
Space is limited – visit huecu.org to reserve your spot today!