This morning I decided to post some helpful information for 1st time buyers. There are many people who may not know where to start when seriously thinking of buying a house. Besides the obvious – paying your bills on time, building up some savings, a steady income…when you’re ready, you will need to get pre-qualified with a lender, which should result in them providing you a Pre-Qualification Letter (Most Real Estate Agents will ask to see this letter before even showing you a home in person as not to waste anybody’s time).
Here is a list of some of the documents the bank/lender will be asking you to provide in order to get you started for a pre-qualification:
- Copy of Social Security card and Driver License
- Copies of checking and savings accounts statements for the last two – three months – ALL PAGES
- Evidence of any other assets such as bonds, stocks, or money saved in retirement programs (i.e. 401k or 403b program) that maybe used for the down payment or purchase of the new home.
- Recent paycheck stub(s) for last 30 days
- W-2 forms and income tax returns for the past two years – ALL PAGES
Just remember – at least 1 year in advance, it is important to do the following:
Tips from Realtor.com
Pay Your Rent on Time!
It is very important that you pay your rent by check each month and that you pay it on time. Lenders will look at this as an indicator of how you will handle your mortgage with them. If you’re habitually late with your rent check, they can predict that you won’t pay them on time either.
Money in the Bank
Different lenders have different requirements, but most want to see that you have had the down payment in your bank account for at least two months. They also will need for you to have additional funds for reserves.
If you are prepared and can gather these documents ahead of time, you can save time in the pre-approval process. Fortunately the paperwork needed is pretty uniform from lender to lender so you can start putting it together now.
And one more tip from me…
Pay Down Your Debt
Work on paying down as many debts as possible. If you can pay off your car, some credit cards, by all means, do it! If you have unsettled debt on your credit report, try to resolve it – many collection agencies will let you set up a payment plan or settle for part of the balance through one lump sum payment.
Hope this article was helpful. Have a great day!