Tips for first-time homebuyers

November 9, 2011

There’s never been a better time to be a first-time homebuyer, and Chris Seeley agrees. Inan article he wrote titled, “Tips for First Time Homebuyers,” the Vice President of Business Banking & Mortgage Loans for Premier Bank & Trust and ystark! member provides tips for first-time homebuyers as well as how your mortgage lender can help.

With mortgage rates low and homes plentiful, it’s an ideal time for first-time homebuyers to take the plunge. First-time homebuyers should map out the process before making a decision to make their homebuying experience a good one.
 
Frame your budget by prequalifying
Meet with a lender to obtain a prequalification for a loan. Prequalifying helps you get a better understanding of how much you can spend on a home. It also provides an estimate of what a monthly mortgage payment will be based on the amount borrowed. Prequalifying doesn’t mean you’re committing to a mortgage; rather, it is the first step toward a mortgage.
 
Keep in mind when you prequalify for a specific dollar amount, it’s wise not to spend it all on your dream home. However, a prequalification will help you narrow the price range of homes to consider purchasing.
 
Avoid using the Internet for a pre-approval
Many first time homebuyers turn to the Internet to search for homes and to get pre-approved for a mortgage. When you go online to get pre-approved for a mortgage, the website doing the analysis will pull your credit report. This is called an “inquiry” by the credit agencies, which indicates that you are looking for additional credit and are thinking to increase your debt. Each inquiry has a negative impact on your credit score.

The computerized pre-approval system also asks several questions about your income and financial situation. These are complicated questions and if answered incorrectly may give you an inaccurate pre-approval. To get a good idea of your prequalified amount, make an appointment with a mortgage loan officer at Premier Bank & Trust or your local bank.  

Integrate your mortgage into your overall budget
Before you shop for a home, consider putting your budget on paper – including your potential new mortgage amount. Then compare your current monthly income to these newly calculated expenses. 

The excitement of homebuying can overshadow budget realities. An experienced mortgage lender will help provide a snapshot of your monthly income versus expenses before you fall in love with a home that will be a strain on your budget.

Talk to your lender about financing options
First-time homebuyers may have access to exclusive loan options, discounts and down-payment assistance from The Ohio Housing Finance Agency (OHFA). OHFA has a program for recent college graduates. It also has a program for heroes, which provides grants and rate discounts for active military, firefighters, EMTs, healthcare workers, police and teachers. A mortgage lender can provide details on all first-time homebuyer opportunities.

With nearly a decade of experience in the banking industry, Chris Seeley is the Vice President, Business Banking & Mortgage Loan Officer for Premier Bank & Trust. He is highly involved with ystark! as incoming Chairman for 2012 and a member of the Executive Committee. E-mail him at chris.seeley@mypbandtbank.com.

Premier Bank & Trust, provides financial services to small businesses and consumers through four full-service banking locations in Stark and Wayne Counties. For more information, visit www.mypremierbankandtrust.com.