Advice for first-time homebuyers : The Denver Dream Team : RE/MAX of Cherry Creek

Advice for first-time homebuyers

Buying a home can seem like a stressful and confusing process. We have broken it down into 3 simple steps. After a few minutes of review you will feel confident about taking the next step to owning your first new home.

Step One - Finding out what you can afford

Your first step is to find out what you can "qualify" for. This doesn't mean you are approved for a loan yet, but what it will tell you is how much of a loan the lender will give you. Several factors are involved in determining what you qualify for and a mortgage broker of your choice or one that Dream Team recommends will be able to give you this information within minutes. When selecting a Mortgage Broker, make sure that they fax you a "Good Faith Estimate." Review that with your Dream Team agent before finalizing your choice of mortgage brokers.
You may be able to qualify for more of a loan than what you feel comfortable paying. When you speak to your mortgage broker, make sure you find out what the monthly payment (including principal, interest, taxes and insurance) will be and make sure it fits within your budget. A good mortgage broker should be able to give you several options to meet your current needs and goals. Don't worry if you don't have money for a down payment or EVEN closing costs. Your mortgage broker should be able to help you get your first home even if you don't have that much cash available to you.
After asking some simple questions about how much income you make before taxes, verifying your credit, reviewing your current debt and verifying how much money you are thinking about putting down, the mortgage broker will have a good idea of what kind of loan you could qualify for. Keep in mind that down payments can range from 0-20% or more. The next step is to begin looking for a home AND start the process to get actual approval for your loan.

Step Two - Getting approved for your loan

The next step is to get a pre-approval. It is recommended that you start the process of pre-approval even before you find the perfect home. Your mortgage broker should be able to provide a pre-approval within a 24-hour period with a LIMITED amount of paper work from you.
Once you receive the pre-approval, your mortgage broker will help you with items that you will have to gather to finalize the approval. Some of these items might include:
- 30 days worth of your pay stubs
- 2 months of your most recent bank statements
- Last quarterly statements for any investment accounts
- Information about the insurance company you would like to use

People have come to expect that tax returns are required. If you are working with a lender who is using current technology and you have good credit, it will be unlikely that you will have to provide tax returns or any other documentation.

During this approval process, make sure to avoid the following:

Do not quit or lose your job.
Do not make any major purchases such as a car or furniture
Do not fully pay off any of your credit card or loan debt without first speaking to your mortgage broker.
Do not switch banks or move your money around.

Step Three - Finding your home

Meet with your real estate agent and let them know what you qualify for.
A member of the Dream Team will help you through a process to narrow down what is most important to you in buying your home. Then he or she will find the homes that fall within your parameters. This very effective process enables them to find the right home for you within a very short period of time.
When you find the perfect home, your Dream Team agent will help negotiate the best possible price for you and make the offer. They will also assist you and your mortgage broker during the loan process, make sure the title insurance is correct, set up the inspection and make sure that property is free of any liens. In short, your Dream Team agent provides a "hands on" approach to purchasing a home throughout the entire process so you can sit back and enjoy a very exciting time in your life.
When it is time to close, they will review all the figures to ensure accuracy and attend the closing with you. They can also provide qualified references for movers, locksmiths, painters, and other service providers.

If you follow these three simple steps with the guidance from your agent at the Denver Dream Team and a qualified mortgage broker, the process of buying your first home will be one that you will be happy to share with the people in your life for years to come.