Renee Davis: Indy Real Estate Agent

First Time Buyers

Creating a Path to Homeownership

Becoming a homeowner is an exciting adventure with many twists and turns in the process. Here is a quick guide that you can use to create your path to buying your first home.

  1. Set Your Budget
    • Before you start your search for a new home, you’ll need to have an idea of how much you’re comfortable with paying every month. When establishing a budget, keep in mind your other monthly expenses. You should budget your installment loans, credit card payments, projected utility expenses, taxes, and insurance. You may also want to consider how changes in your family size could affect your budget. Once you have an idea of how much you want to spend per month on your mortgage, use Zillow’s Affordability Calculator to find out how much house you can afford. The key – buy a home within a budget you are comfortable with maintaining.
  2. Review all 3 Credit Reports and Scores
    • The first step to buying a home is establishing a good credit history and score. Your credit score (and the items on the report) will determine which lending options your qualify for. Most lenders would like to see at least a two year payment history without late payments and no accounts in collections. If you find your credit report has collections and late payments, that’s okay! There are many resources and professionals available to help you restore your credit.  Reviewing this information before or during your first meeting with a real estate agent or loan officer will help them guide your next steps towards reaching your goal of homeownership.
  3. Meet with a REALTOR
    • One of the first people you should meet with is a licensed Realtor. An agent is going to be your best resource during this period of time. Realtors have access to every home on the market, including the ones that are not listed publicly. They are well connected with the people and tools you need to get approved and close on the purchase of your home, such as a loan officer. Realtors have the expertise to help you prepare a killer deal—while avoiding delays or costly mistakes that can seriously mess you up.
  4. Meet with a Loan Officer
    • Meeting with a loan officer early in your preparation process will put you on the path to approval. They will help you identify the areas you need improvement such as outstanding debts and payment history. They will identify which mortgage programs you qualify for and if you can receive assistance with down payments and closing costs.
  5. Establish a Savings Plan
    • After you’ve met with a Realtor and loan officer, you will a better understanding of what you will need financially to buy your first home. If you are interested in buying with an FHA Loan, you will need 3.5% of the purchase price saved for a down payment. You plan to save an additional money saved for closing costs, the appraisal of the home, and the inspection. These costs will vary and your loan officer will be able to give you an estimates based on the financing options you choose. After you have saved the money needed to purchase your home, continue to save and aim to have an emergency fund for unexpected home repairs and a minimum 1-3 months of mortgage payments in the event of an illness, layoff, or job loss.

About Renee Davis

Picture of Renee Davis

Renee Davis

Realtor/Associate Broker

renee@themodglingroup.com

317-593-2068317-593-2068 main

The Modglin Group

432 South Emerson Ave, Suite 120, Greenwood, IN 46143

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