5 Tips For First Time Home Buyers

Buying a house is a big step, especially if it's your first home. There are many factors that go into a purchase of a home, so it is important to do your research before you begin looking at houses in the Colorado Springs area. The Platinum Group, REALTORS have a few tips you should consider if you are thinking about buying your first home in Colorado Springs. 

1. Know Your Credit Score

Your credit score is one of the most important factors when it comes to qualifying for a home loan. When checking your score, it is important to look over the report for any mistakes, unpaid accounts or collection accounts, as these all affect the score. In addition, it is important to note that just because you pay everything on time every month, it doesn't mean you are going to have a good score. There are many things that go into determining a score and it is important to know where you stand. If you have a poor score, repairing it will take time, so start at least six months before shopping for a home. 

2. Evaluate Spending Habits

It is important to know how you are spending your money. First-time homebuyers should have a budgeting sheet and know how much money is coming in, but more importantly, how much is going out. Track your spending habits for a couple of months to see where your money is being spent. 

3. Get Documents Together

When applying for mortgages, homebuyers must document income and taxes. They will typically request 2 recent pay stubs, the past 2 years' W-2s, tax returns and the last 2 months of bank statements. Buying a home can take a long time, however, knowing what you need and where to find it can save time when you're ready to apply for a mortgage. 

4. Know What You Qualify For

Before you start looking for your starter home, it is important to know how much money you actually qualify for. You don't want to fall in love with a home you can't afford. Although you may think you can afford a $300,000 home, lenders may think you're only good for $200,000. There are many factors that go into determining how much you qualify for, such as how much debt you have, your monthly income and how long you've been at your current job. It is best to know this number ahead of time so you know what types of homes you should be looking at. 

5. Know How Much You Can Afford

On the other hand, sometimes a bank will give you a loan for more money than you actually want. Just like with the purchase of a new car, you'll want to look at the house's total cost, not just the monthly payment. While looking at the monthly payment is important, it's vital to look at the whole picture. Take a look at how much down payment you can afford, how hight the property taxes are, how much insurance will cost, how much you plan to spend on insurance or maintenance and how much closing cost will be. 

There are many factors that go into buying a house, luckily, with the help of a trusted Colorado Springs real estate agent, the buying process can go smoothly. If you are thinking of relocating to the Colorado Springs area, let The Platinum Group, REALTORS help you find your dream home. Our real estate agents are some of the top agents in the area and know the areas well and can help you find the perfect home!