Steps to Buying a Home Early in Life

Investing in Home in which you are going to live is a big decision of life these steps can make the home buying process Easy and help you make better decisions as possible.

Step 1: Start Your Research Early As soon as you can, start reading websites, newspapers, and magazines that have real estate listings. Make a note of particular homes you are interested in and see how long they stay on the market. Also, note any changes in asking prices. This will give you a sense of the housing trends in specific areas. Step 2: Determine How Much House You Can Afford Lenders generally recommend that people look for homes that cost no more than three to five times their annual household income if the home buyers plan to make a 20% down payment and have a moderate amount of other debt. But you should make this determination based on your own financial situation. Use our Affordability Calculator to see how much house you can afford. To help you save for your down payment, try Discover Bank’s Auto Savers Plan, which makes it easy to put aside money each month.

Step 3: Get Pre-qualified and Pre-approved for credit for Your Mortgage Before you start looking for a home, you will need to know how much you can actually spend. The best way to do that is to get pre-qualified for a mortgage. To get pre-qualified, you just need to provide some financial information to your mortgage bankers, such as your income and the amount of savings and investments you have. Your lender will review this information and tell you how much we can lend you. This will tell you the price range of the homes you should be looking at. Later, you can get pre-approved for credit, which involves providing your financial documents (W-2 statements, paycheck stubs, bank account statements, etc.) so your lender can verify your financial status and credit.

Step 4: Find the Right Real Estate Agent Real estate agents are important partners when you’re buying or selling a home. Real estate agents can provide you with helpful information on homes and neighborhoods that isn’t easily accessible to the public. Their knowledge of the home buying process, negotiating skills, and familiarity with the area you want to live in can be extremely valuable. And best of all, it doesn’t cost you anything to use an agent – they’re compensated from the commission paid by the seller of the house. Step 5: Shop for Your Home and Make an Offer Start touring homes in your price range. It might be helpful to take notes (using this helpful checklist) on all the homes you visit. You will see a lot of houses! It can be hard to remember everything about them, so you might want to take pictures or video to help you remember each home.