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Ready to buy your first home in Atlanta? Almost everyone dreams of owning a home. It feels good to have a property that belongs to you and, of course, it is one of the best financial investments you will ever make. Property values tend to go up over time, so you will gain precious equity as the home appreciates year after year. This equity can later be leveraged to buy your next home and move up into something even better than your starter home.
Homeownership comes with wonderful financial and emotional benefits. It’s also good for your taxes as you are able to deduct mortgage interests, certain closing costs and other expenses. There are so many benefits to owning a home, especially when compared to renting and just paying your landlord’s bills from month to month!
So, the big question remains:
Are you ready to buy your first home?
This is actually a very loaded question. Though just about everyone wants to buy a home, it doesn’t mean they are actually ready for such a big transaction. Buying a house is not like buying a car or taking out a small loan. This will likely be the largest financial purchase you have ever made. Therefore, you should not take the process lightly. It is important to be prepared—both financially and emotionally.
Let’s first explore the emotional implications of buying a house. First-time home buyers in Atlanta are usually filled with both excitement and anxiety. Yes, it’s an exciting step in life when you feel you are ready to buy your first home. At the same time, the processes of qualifying for a mortgage loan, searching for properties, making offers and going through the final closing process can be intimidating if you’ve never experienced them before. You definitely want to make sure you are emotionally prepared to buy your first home before you dive head-first into the deep end.
It will be very beneficial to have some expert guides and trusted advisors on your side. Talk with friends and family who have been through the process. Understand exactly what you are getting into and make sure you feel the time is right for you to proceed with your biggest move to date. You will also want to hire a trustworthy real estate agent to provide professional guidance and support throughout the process. Keep in mind the buyer’s agent’s commissions are generally paid by the home seller, so hiring a Realtor is a no-brainer for a home buyer.
Lastly, talk with several banks, mortgage lenders and mortgage brokers. Explore your different lending options and find someone you trust to guide you through the mortgage process. See which first-time home buyer programs may be available to you. Then, make sure to get pre-approved for your mortgage loan before you start your home search. This will help you figure out how much you can truly afford to borrow and make the overall home search and closing processes so much smoother.
The Financial Implications of a Mortgage Loan
This leads us to the financial side of things. You may be emotionally ready to buy your first home, but your finances could be a different story. It is important to get your finances in order as much as possible before you think about purchasing real estate. This will likely be the most money you have ever spent on anything to this point in your life. We’re talking about hundreds of thousands of dollars. This is not something you will want to take lightly.
Before you apply for your first mortgage loan, you should work to pay down other high-interest debts you have like credit card balances, student loans and car loans. You should aim to increase your credit score. This is done by establishing lines of credit and paying your bills on time. There may be some lenders willing to qualify you for a mortgage loan without a hard credit check or if you haven’t established a significant credit history. They will look at other financial factors to determine if you are a good borrowing candidate. You may even consider adding a co-borrower on your loan (like your parents), as that can help lower mortgage rates and ensure qualification.
Other factors mortgage lenders will review will include your employment and income history, as well as your current savings. They want to see that you are financially stable with a steady income each month that will enable you to afford your monthly mortgage payments. Finally, you will want to save up for a healthy down payment. The larger down payment you can make toward your mortgage loan, the better off you will be. You will be able to qualify for a lower mortgage interest rate and be able to afford a more expensive property.
It is smart to get pre-approved for your mortgage loan before you start your home search. Mortgage pre-approval will let you know how much you can afford and will give you more buying power once you are ready to start making offers.
Get yourself financially and emotionally ready to buy your first home in Atlanta. Then, call Moreira Team | MortgageRight to get started with your home buying process. We’ll help you explore your lending options and get you pre-approved for you loan with the best mortgage rate possible. If you need help finding a good real estate agent in the area, let us know. We have a network of excellent professionals to help you with every step of your home buying journey.