By
Amy Krikken
Interest
rates are still relatively low, supply is beginning to return to normal and
Millennials are entering the market in droves. Many people assume that
they can't afford to own a home, however, that is not always the
case. There are great programs out there for first time home buyers, some
have very little money down required in order to purchase a first home. First
time home buyers can best prepare themselves if they know a few things ahead of
time. Often the first step is contacting a loan officer/mortgage broker to
obtain prequalification.
This
process involves giving the mortgage broker a quick picture of your income,
assets and debt. Before you even begin perusing the listings on line and
driving by houses, you should do yourself this favor. There is no sense in
getting hopeful about a home that you can't afford. Your loan officer will lead
you through a simple process that will yield that magic number, then you can
begin your search. What you need to provide to be prequalified are two years of
W2's (or two years of tax returns if you are self-employed), thirty days’ worth
of pay stubs, and two months of bank statements. You will also want to check
your credit report, as you will want that to be at its best before you
officially apply for the loan.
There
are some surprising things that you should, and more importantly should not do,
when you are in the process of shopping for a home.
Katrina
Virgie of Northstar Mortgage here in Windham, has developed this helpful
list:
DO
call your mortgage company if you have any questions.
DO
provide requested documentation promptly and in its entirety.
DO
continue living at your current residence.
DO
continue making your mortgage or rent payments.
DO
continue to use your credit as normal.
DO
keep working at your current employer.
DO
keep your same insurance company.
DO
stay current on all existing accounts.
DON’T
change your employment status.
DON’T
make any major purchases (car, furniture, jewelry, etc.).
DON’T
change bank accounts.
DON’T
make any large cash deposits into your bank account.
DON’T
transfer any balances from one account to another.
DON’T
close any credit card accounts.
DON’T
consolidate your debt onto one or two credit cards.
DON’T
apply for new credit or open a new credit card.
DON’T
max out or overcharge on your credit card accounts.
DON’T
take out new loan or co-sign on a loan.
DON’T
pay off any loans or credit cards, charge offs, or collections without discussing
it with your mortgage company first.
DON’T
finance any elective medical procedure.
DON’T
join a new fitness club.
DON’T
open a new cellular phone account.
DON’T
start any home improvement projects.
DON’T
have your credit pulled or dispute any information on your credit report.
If
you encounter a special situation, it is best to mention it to your mortgage
broker right away so they can help you determine the best way to achieve your
goals. Most importantly remember that you are not alone, your real estate
agent, and your mortgage company can take the guess work out of the process,
and make this a smooth transition into your new home.
Amy
Krikken, Maine's Rock Star Realtor, can be reached at 207-317-1338 abkrikken@gmail.com to
assist you in your home buying or selling needs. Mortgage Maven Katrina Virgie
can be reached at kate@northstarmortgage.net.
to help you find the mortgage that is right for you.
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