Lending

Three steps to help homebuyers | Business

Traditional home buying season is fast approaching. If you’re considering buying, now is a great time to learn how to make more possible with an affordable home loan.

There are plenty of options for first-time buyers, veterans, and those simply looking to tap into their home’s equity to renovate, especially with home values ​​(and equity) continuing to rise. month to month.

Here are a few simple steps to get you on the right track:

1. Understand your options

Talk to a local loan professional. They can help you understand your home buying options, pre-qualify for a mortgage, and estimate your total monthly payment (including principal, interest, taxes, insurance, and homeowners association fees). ), as well as determine your closing costs and the amount required. at closing.

Mortgage officers must be registered with the National Mortgage Licensing System, so start with your local bank or credit union – they may even offer free online calculators on their website to help you start the initial search – to determine how much home you can comfortably afford so you can confidently shop for a new home.

2. Be a smart buyer

Next comes the fun part for new homebuyers, the shopping. There are many ways to start your search.

Here are some ways to find homes for sale in the city or neighborhood you want to live in: social media, real estate websites, newspapers, asking friends, driving around town, open house events, and working with a real estate agent.

3. Make your offer

It’s still a seller’s market in 2022, but most real estate economists expect the torrid growth in home prices to slow this year, according to Kiplinger. With interest rates expected to rise, you may want to start negotiations early and have your mortgage pre-approval ready.

Getting pre-approved is more important than ever in today’s environment, as a high percentage of homes see offers coming in immediately after being listed. Timing is therefore key to getting the home you want. Qualified buyers may also have a stronger negotiating position, so ask questions such as “Will the seller pay closing costs?” early in the process.

Remember that a trusted lender is essential. Consider local financial institutions that offer free educational tools, loan calculators, and local expertise to guide you through the home buying process. And don’t forget the fees. Fees charged by lenders, including those due before and at closing, can vary widely in amount and type depending on the institution.

All lenders are required to provide two documents to clarify the costs associated with their mortgage loan: a loan estimate, three days after loan application and a closing disclosure at least three days before closing.

If anything doesn’t look right or changes significantly from the loan estimate, ask your loan officer.

Owning your home gives you the opportunity to build equity, make improvements to your property, and enjoy a fixed monthly payment if you choose a 30- or 15-year fixed mortgage. If owning or moving to a larger property is one of your goals for 2022, do your homework now so you’re ready to act.

Charles Eads is director of loans for Abound Credit Union.

Charles Eads is director of loans for Abound Credit Union.