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Buying a home is an exciting experience for you and your family’s future. Like any financial commitment, it’s important to educate yourself on the options and make sure your bases are covered. Follow these 5 steps to help get your finances in line… and you and your family on the road to a new home.^†

 

Step 1: Assess your financial situation

Before you start shopping for a new home, you want to be sure that your earnings are steady and can handle the financial obligation of a Mortgage That means understanding your budget and expenses, and making sure you’re on track with retirement goals. And it’s a good idea to make sure you have an emergency fund to help cover unexpected expenses.

Step 2: Check your credit score

Having a good credit score can help considerably when negotiating a better rate on your home loan. For a clear idea of your credit health, obtain a copy of your Credit Report from each of the 3 major credit reporting agencies: Experian, TransUnion and Equifax. If there are any inaccuracies, contact the reporting company to make a correction, as it could help improve your overall score.

Step 3: Figure out your price range

Look into the cost of a new home and how much you can afford. This means doing a little research and taking all potential home-related expenses into account including your mortgage payment, homeowner’s insurance, property tax, utilities, HOA fees, maintenance costs and so on. Pulte Mortgage's Mortgage calculator is a helpful tool and good starting point.

Step 4: Save up for a down payment

Conventional loans have minimum down payments ranging from 5% to 20%; FHA loans require 3.5% if you qualify. If you’re eligible for veteran financing through the VA, you may not need a Down Payment Once you have your down payment goal, designate a monthly amount to put toward it in a separate savings account. Remember, the more you can put down when you buy, the lower your Monthly Payment will be and the less Interest you’ll pay overall.

Step 5: Get prequalified

With basic information on your income, savings and credit, your lender can give you an estimate on how much you qualify to borrow.