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Publish Date: June 2024
No matter what stage you’re in, homeownership can be stressful. That’s especially true in today’s market, which has been hampered by higher loan interest rates, low inventory and high-priced listings.
Whether you’re in the market for a new home or your first home, it’s easy to let yourself become intimidated by the prospect of homeownership. It doesn’t have to be scary. With a little knowledge and preparation, you can be ready for the homebuying process.
“Homeownership is a strategic investment in your future, but doesn’t have to be a daunting venture,” said Kathy Seyfert (NMLS #503197), Vice President of Retail Loans at Fidelity Bank & Trust in Maquoketa. “Even in today’s market, owning a home is an attainable goal that fosters stability, builds equity and unlocks a wealth of possibilities.”
Learn more as Kathy explains the homebuying process and how you can be prepared:
DETERMINE YOUR HOMEBUYING READINESS
Before you even consider buying a home, it’s important to know how the homebuying process works. It starts with making sure you’re financially ready to make such a large purchase. Factors to consider include your total savings, total debt and credit history. These factors will help determine your qualifying loan amount, interest rate and how much you can afford as a down payment.
Speaking of down payments, the more you can pay up front, the lower your payments and the higher your equity. Typically, homebuyers try to put down 20%. This isn’t a requirement, but doing so could help reduce the interest rate on your mortgage. If you are able to pay 20% as a down payment, you won’t have to pay for private mortgage insurance, which will save you even more money.
Once you determine you’re ready to buy a home, it’s a good idea to get pre-qualified for a mortgage. By getting pre-qualified, you will have a solid understanding of the amount of the home loan you qualify for, and it will eliminate that step when you are ready to make an offer.
TYPES OF LOANS
When you go through the pre-qualification process, talk to your mortgage loan officer about the different loan options available. A conventional loan is the most common type of mortgage with the interest rate typically being based on your credit history and down payment. Other types of loans may be available to you if you qualify, so be sure to ask your lender.
Once you are pre-qualified and have an idea of what type of mortgage you need, it’s time to start home shopping. Be sure you stick to your budget as determined by the amount you were pre-qualified for. Look at as many houses as you can, to get a sense of the type of home you need.
DOCUMENTS YOU’LL NEED
Once you’re ready to start the mortgage process, you can make things more efficient by having the following documents and information ready for your mortgage loan officer.
“Finding a new home may carry its share of stress, but it's equally a thrilling milestone,” Kathy says. “Being prepared for each stage of the homebuying process enables you to fully savor the excitement that comes with it."
Contact us to discuss how Fidelity Bank & Trust can help you save to achieve your goal of homeownership. If you're ready to get started, visit our Mortgage Center to check rates, apply online or find a lender that's right for you!
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