Five Simple Steps To Home Ownership

By Lisa Scontras

Buying your first home can be intimidating at the onset. Let’s face it, it’s a big commitment. But for decades, homeownership has continued to be a goal for many – a stake in their future. Lots of people have done it and so can you. You just need to know how to get started.

Linda McCabe, Realtor and partner at Prudential Locations LLC, is passionate about helping first-timers to realize their dream of homeownership. She offers these critical first steps to help you navigate through the process with confidence.

Step 1: Get your team together

Buying a home may be the biggest investment you ever make – so it pays to call in the experts. You’ll need a Realtor and a loan officer. A Realtor will represent you and your interests during the home-buying process. Yet the seller generally pays their commission, so as the buyer, these services are free for you.

McCabe’s advice is to find someone you can relate to, who displays a solid knowledge of the marketplace, and who will give you the attention you deserve to achieve your goal.

“First you should know that we are not going to ‘make you’ buy something,” says McCabe, a 27-year veteran in the field. “I really enjoy my work and helping first-time home buyers adds an even more rewarding aspect to my day. If you tell me you want to buy a home, I will lay out the steps you will need to take to get you there.”

Once you’ve found a Realtor, the next step is to find a loan officer.

Your Realtor can be an invaluable resource here. McCabe, who is now helping her clients’ children buy their first homes, insists the first stop, even before getting into the car to look at property, is the lending office.

It is best to meet with the loan officer in person, so you can learn the process and loan options needed to chart the right course.

“Your Realtor should be a part of this as well, as your advocate and as an additional set of ears,” says McCabe. “You won’t remember everything, so use these people as backup resources.”

Step 2: Pre-approval

The next step is to talk numbers. The lender will ask how much you would like to spend monthly, followed by a series of questions about your income and your expenses to determine how much house you can afford.

“You and you alone ultimately decide what your comfort level is,” says McCabe. “The upper limit to your qualification may not be right for you. The goal is to learn exactly what your monthly commitment will be.”

She says that shoppers who skip this step and jump right into the car to look at property are making a huge mistake.

“If you start looking at homes that cost $650,000 when what you can really afford is a townhome for $350,000, you are wasting your time and risking extreme disappointment,” she adds. “Do it right at the outset and get pre-qualified.”

Remember, lending has changed immensely these past two years and continues to do so.

“It can be frustrating, so it is very important to be aware of the added patience and preparedness that is now required,” says McCabe. “This cannot be overstated.”

Step 3: Clean up your credit report

Part of getting pre-approved will include a check of your credit score, which according to McCabe is the most important piece of the puzzle. If your score is low, you won’t qualify for the best interest rates and loan programs. The loan officer will advise you on what you can do to improve your score.

“Not everyone can buy a house today,” says McCabe. “Sometimes it’s necessary to take some time and repair your credit, have inaccuracies removed, pay down some debt or go 12 months without being late with your payments. Depending on

your situation, this might take a couple of months or it might take a year. However, the higher score will pay off when you are ready to buy.”

Step 4: Financial documents

In some cases, you might be able to prequalify for a loan without all of these documents, but it’s best to have them handy.

Basically, what you need to bring to the loan officer is two years of most recent tax returns, last two pay stubs and last two bank statements. If these items are not immediately available, now is a good time to start gathering them.

Step 5: Start your search online.

Most buyers begin their property search online.

“At Prudential Locations, we hand over to our clients the entire MLS book virtually,” she says. “By using Prudential Locations.com you can get familiar with the market and the neighborhoods you are considering. You can search the sold information to help you get an idea of what things are selling for. With all the listings at your fingertips you can take the dollar amount the loan officer gave you and begin a valid search for your future home.”

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