Six Items for First Time Homebuyers in 2022

Fingers are crossed across the country that 2022 will be a better year than 2020 and 2021. These days it seems like that’s not saying much, but homebuyers are a group who have been heavily influenced by the changes of 2020 and 2021. In dusting off the crystal ball to take a look into 2022, there are a few items that won’t require a conjuring of spirits to navigate. 

Purchasing a home for the first time already seems like a herculean task. The good news is that there are some things to know that will simplify the process and help you move from renting to owning your first home.

Here are some tips to help first-time homebuyers navigate 2022 and land the perfect first home.

1. Know how much home you can afford. Preapproval is perhaps more important than ever when it comes to purchasing a home. Fear not, if you are like the average first-time homebuyer, then you simply don’t have a large reservoir of cash to make an all-cash offer. What clouds your prospects is that there are still a significant amount of all-cash buyers out there. Opting for preapproval communicates with sellers that you are both serious and able to move quickly. This alone may help make you competitive in a bidding war. There are many calculators available across the web that can help you determine what the monthly payment amount will be to find the right comfort level for your budget.
2. Find and target your desired area. It is important to have a good idea of where you want to live. Do you prefer more urban with all of the amenities or would you prefer a more rural setting with some extra space either inside or outside? Targeting the right areas helps you understand how much you will have to spend to land your first home.
3. Check your credit. You will want to do this prior to obtaining preapproval, but it is a good idea to review your credit report and determine if there are any discrepancies on the report. Obviously, and especially as a first-time buyer, a better credit score will help you qualify for a loan more easily and may offer a better rate over a lower score. Working to repair your credit if there are any issues can help you head off problems later in the process.
4. Avoid other major purchases like vehicles. Saving up for a downpayment will likely be enough to zap your budget for other larger purchases anyway, but making a large purchase around the same time that you plan to buy a home can negatively impact your debt-to-income ratio. The debt-to-income ratio will affect how much of a loan you can qualify for which can limit your options. If you know you will need a vehicle, for example, postponing the purchase, if possible, can be a wise decision. Avoid opening new credit cards or miss any debt payments, as these all negatively affect your credit score.
5. Team up with a great real estate agent. While it can seem worthwhile at first glance to forgo the real estate agent and see if you can cut the commission that you’re paying out, a real estate agent ultimately serves as a wise guide to help you navigate the pitfalls of purchasing your first home. Real estate agents don’t just help with the purchase, though, as they can offer insight into schools, taxes, property valuations and more.
6. Lock in the right mortgage broker. There are many reasons you will want to opt for a mortgage broker over a bank. At the end of the day, teaming up with the right mortgage broker offers first-time homebuyers the opportunity to survey the market’s offerings and find the best loan for each unique situation. Don’t make the mistake of making an offer on a home without knowing what you can afford. The preapproval process is a great way to stand on solid ground and know precisely what you can afford to pay for your future home. If you would like to talk more about the lending portion of the first-time homebuyer process, we recommend that you contact Range Lending to answer your mortgage questions and possibly begin the mortgage preapproval process.

If you are ready to take the plunge into first-time home ownership in 2022, Range Lending can help.  Taking the six items above into account can help you navigate first-time homebuyer status and be well on your way to finding that perfect home. We wish you happy house hunting in 2022 and stand ready to help you find your best mortgage loan rate.