What are the basic steps if youre looking into buying a house?

Question

Besides good credit, and a large down payment, what are some other things youll need?

Answer 1

After the last few months of searching for a house, I learned quite a bit...  You don't neccessarily need a large down payment or any at all depending on which type of loan you qualify for.  However, you will need "hand money" down when you sign the sales agreement- this is typically 500-1000.  This lets the buyer know that you are serious about buying their house.  If you happen to need to back out of the house, you typically get this back, unless you are backing out for no reason.  You also need money for your appraisal and money for closing costs (unless you ask for seller's assist when you sign the sales agreement which generally justs rolls the closing costs into your mortgage).  Make sure that when you get an agent, that they are knowledgable about the area that you are looking in, as well as the loans that are available for you.  Each loan such as FHA, VA, and conventional have their own set of requirements and each are different.  You will also need to have money for a home inspection (this very beneficial to you as this reveals more than what is visible to the naked eye and lets you know what you could be in for (this is why we backed out of the last house...there was a lot a repairs that needed down to the house that we didn't even think about)).  Lastly you need time and patient, house hunting is a lot of work, consumes a lot of your time going from house to house and is very stressful trying to find exactly what you are looking for, but is very rewarding in the end once you do.

Good Luck and Happy Hunting!

Answer 2

You are correct a good credit and a good credit score is needed to get the very best interest rate.

Your credit score will basically determine the amount of downpayment you will need based on the loan programs you are qualified for.

If you so desire you may put more down that is a decision you will have to make.



In order to find out the type of loan programs you are qualified for you will have to fill out a loan application, with a mortgage broker, which you can find one in your local telephone book. Make sure this mortgage broker or mortgage banker is able to do government loans such as FHA and VA loans if you qualify for one.

He will fill out this application, which takes awhile so grab your favorite beverage and sit down. Once you have completed the application, he will run your credit report which will have your credit scores.  These credit scores will determine your interest rate.

The amount of your monthly debt payments you are required to pay as per your credit report and the amount of mortgage you can take on based on your income will determine the amount of house you will be able to purchase.

When you speak with the mortgage broker you will need the following documents to complete the loan application, there will be others, but this will get you started.

#1 One month of pay stubs for each person that will be on the mortgage.

#2 Six months  bank statements from each bank in which you bank as well as statements from any 401K from you place of employment.

#3 Two years of federal income tax along with the W-2 that match.

Once he has all that he need to do he can then issue you a pre-approval letter so you can purchase a home. In this pre-approval letter will be the amount of house you are qualified to purchased.

Once he gives you this pre-approval you may now find a real estate agent to find yourself a home or he might have a referral.

Now make sure before you get your pre-approval you and your mortgage broker go over all your options as to the mortgage programs you qualify for, the interest rate, monthly payments.

If you are getting a FHA, fixed rate, two loans to eliminate PMI like an 80/20 or one loan, if you are qualified for and approved for a 100% loan.

You should select the loan that best suit your financial condition at the time. That could be an adjustable rate loan. It could be a fixed rate loan for 5 or 10 years and then adjust. Some adjustable rate mortgages only adjust once.

Make sure your mortgage broker explain all your options so you may make an intelligent decision.

What might be good for one person might not be good for you, in other words just because your friends and all your real estate buddies are telling you about the great fixed rate they got, your financial situation might call for something else.

So select the best option for you and your financial situation.



You should also get a Good  Faith Estimate (GFE) which will indicate the cost you will have to pay for getting this loan. It will also indicate the amount of your down payment.



Once you have found a home the real estate agent will then prepare a contract for you and the seller to sign.

Your mortgage broker will now order an appraisal to show proof of  the property value.

The mortgage broker might ask for additional information or documentation, don't get all up tight this is normal, just supply the information or find the documents needed.

After the appraisal has been completed you will be called by your mortgage broker to sign your loan docs so you can take possession of your new home.

Before signing any loan docs make sure they say exactly what you and your mortgage broker went over when you decided on what mortgage program was best for you.

I hope this has been of some use to you, good luck

"FIGHT ON"

Answer 3

Know what you are looking for & how much you want your monthly payments to be. Work with a realtor so they can let you know about the neighborhood etc.

Answer 4

Other than good credit and down payment, the lender also look at your income and debt ratio.  If your income and debt ratio too high, they won't approve your loan. Get a loan officer to look at your financial picture and find out how much you can afford.

Answer 5

Where do you want to live. What is the neighborhood like. What type of home are you looking for. How much can you afford. Stick within your budget