Home Buying 101: What’s My First Step?

There probably isn’t an event in your life as meaningful as buying your first home. It’s exciting and a little scary all at the same time.

You’ve kept an eye on potential homes online or spent time doing the slow-roll through your favorite neighborhoods. Maybe you’ve seen a “For Sale” sign pop up on that stunner with the killer view.

Are you ready? Do you have what it takes (literally) to buy a home?

More often than not, potential homebuyers aren’t sure where to start. But there is one very smart initial step that will cut through the confusion.

Know what you can afford.

It may sound simple, but finding out how much you can borrow from a lender in order to buy a home is the single most important first step in the purchase process. Why even look at a house until you know if you can afford it?

Maybe you’ve saved a lot of money toward a down payment, maybe you haven’t. What matters is that you talk to lenders about your individual financial situation to find out how much they would loan you. They will look at your credit history, debt, income, and what cash you can access. In banker parlance, how much of a loan can you qualify for?

If you want to do some research prior to reaching out to mortgage companies, you can use an online tool like the one provided by the Federal Trade Commission to check your credit score with the Big Three: Transunion, Experian, and Equifax. Next, use a mortgage calculator, like one offered by NerdWallet.com, to get a general idea of how much you will likely qualify to borrow.

Let’s say you’re perfect—you’ve got a great salary, your credit score is top-notch and you’ve got a wad of cash ready as a down payment. Lenders will love you. But for the rest of us who might not be so prepared, will a lender even take a second look? The answer is yes.

Lenders know that imperfect borrowers make up a large share of their customer base (especially with COVID-19 impacting the market) and they have strategies to help you get into your first home. There’s a rub, though—you’ve got to be willing to work at it.

Here’s where finding a great real estate agent comes in. Target the neighborhood where you’d like to buy a property. Find REALTOR®s who are most active in that area—read reviews and narrow down which ones seem to know their stuff. A good REALTOR® is not only going to be your best friend during the negotiation process with a seller, that agent also has built-in relationships with the local lending world. Your agent will know what lenders are most likely to work best for you, especially if your finances are in need of a makeover.

REALTOR®s can also bridge the language gap for non-English-speaking out-of-towners looking to buy—they can point you in the direction of lenders fluent in other languages (Sojourn Real Estate’s very own Carolina Haase—who’s fluent in Spanish—fits that bill!).

Whether you’re buying a starter home, relocating from across the country (like a permanent change of station [PCS] move with the military) or you’re upgrading your digs to a dream house, finding a realtor who is well connected in the banking world is a smart move.

These local lenders offer online options to apply for loans:

For loan information in Spanish:

If you’re ready to make the first move, our agents are ready to help you find the perfect home (or sell the one you’re in!). Pick your agent today!