Meagan Rochard
Meagan Rochard
Welcome, future homeowner! Whether you’re just daydreaming or already picking out paint colors, we’ve broken down how to go from browsing dream homes before bed to getting the keys to your new home! No confusing jargon, no pressure. Just real talk about how you can make homeownership happen.
Why Homeownership Still Matters
For the modern homebuyer, owning your own home is about freedom and stability. As a homeowner, you’re not just paying for a place to live, you’re investing in something that grows with you! Whether you’re dreaming of a smart-tech townhome or a cozy starter home, homeownership is a powerful step toward building the life you want.
Step-by-Step: How to Become a Homeowner Without Freaking Out
1. Get Real About Your Budget
Before you fall in love with that mid-century modern loft in your dream neighborhood, it is best to figure out what you can actually afford. There are many online mortgage calculators that can help you estimate monthly payments and build realistic expectations.
But remember, your monthly payment isn’t the whole picture! Remember to also factor in:
- Down-payment
- Closing costs
- Property taxes, home insurance, and general maintenance
Pro tip: Many young buyers qualify for first-time homebuyer programs that offer lower down payments and other perks. Be sure to look into local and federal options when you’re ready to buy!
2. Check Your Credit Score
Your credit score is essentially like a financial GPA, and the higher your score, the better! A healthy credit score doesn’t just help with home loans, either. It can also have an impact on car loans, apartment approvals and more!
Even if you’re not buying right away, it is never too early to start building good credit! Here are some habits you can start building now that could pay off in the future:
- Always make on-time payments (late payments = major score drops!)
- Keep your credit card balances low
- Avoid taking on any unnecessary debt
3. Starting the Mortgage Process
Once you’re ready to start the homebuying process, you’ll likely complete a Loan Application and be introduced to a dedicated Loan Team. This group of experts will guide you through the financing journey. Here are a few of the key players who will help make the home financing process seamless:
Loan Consultant
They will be responsible for reviewing your Loan Application and provide you further guidance on your loan details. Here is a list of documents they will likely request from you.
Loan Processor
They will work alongside your Loan Consultant and Underwriter to ensure your loan file remains on track. Their attention to detail is crucial for a smooth, stress-free financing process!
Underwriter
Once submitted to an Underwriter, they will review your file with a fine-tooth comb before making the final approval decision. They will be verifying things like your credit history, employment details and your finances to determine if you meet the loan requirements.
PS – Don’t be surprised if your Underwriter requests additional documentation. It’s totally normal!
Closer
After receiving the final approval from your Underwriter, the Closer will coordinate the final stages of the loan process. They will send you the preliminary closing documents and coordinate with the title company to help prepare for your closing day.
4. Closing on Your First Home
Think of closing day as the finish line for your homebuying journey! A few days before your closing date, you will receive a Closing Disclosure with all the final loan details: loan amount, interest rate, monthly payments and closing costs. Be sure to review it carefully!
Watch out for wire fraud scams!
According to a recent report, about 1 in 4 consumers receive suspicious messages during a real estate transaction with 1 in 20 falling for the scam — and unfortunately, first-time homebuyers are three times more likely to.
Buying a home is an exciting achievement, don’t let scammers ruin your moment! Protect yourself (and your funds) by remembering the following tips:
Call, Don’t Email
Before wiring any funds, call your title company directly using a trusted phone number (not the one listed in an email or text). It is extremely rare for title companies to change wiring instructions via email or text, so always confirm payment details by phone call or in person.
Be Suspicious, Always
If something feels even slightly off, it’s best to trust your instincts. Call your lender or title company right away if you receive an email that mentions wiring instructions, especially if it includes last-minute changes or feels rushed. Better to be safe than sorry!
Verify Immediately
Before sending your wire, ask your bank to confirm the account name matches the title company. Then call your title company as soon as the wire is sent to confirm they received the funds. If something does go wrong, catching it quickly will give you the best shot at recovery.
Once all the documents are signed and the keys are in your hand, it’s time to celebrate! You’ve reached an important milestone, and now you can look forward to the journey of making your new house a home!
