To be a successful home buyer, you need to be a good
planner. Since there are steps that require you to qualify for the mortgage loan, you need to have
everything in order before you start shopping for a house. Not only will you get the house you
want, but you will save a tremendous amount of time, money, and effort.

To start the planning process, you should actually start a few months to a year before you
actually buy. The reason this is important is that the lenders will be reviewing your credit history,
specifically looking back 12 months to see if you pay your bills on time, ahead of schedule, more
than the required amount, and so on. Additionally, the lender will want to see a minimum of six
months of your bank statements, preferably one year. This shows them not only the amount of
deposits and withdrawals but also if you have a consistent problem with insufficient funds.

Planning a year out from buying allows you time to make sure any inaccuracies on your credit
report are cleared up or if you do not have credit, that you have adequate time to establish it. If
you are currently renting your home, be sure you have proof of monthly payments through a
receipt from the landlord or a canceled check or money order. This too will prove to be valuable
in showing that you pay in full and on time.

You will also want to have a job history with the same job for at least a year and longer if
possible. Therefore, if you are thinking about changing jobs, you might wait until after you buy a
home, especially if moving from one industry or job group to another. Depending on the industry
in which you work, some lenders will allow you to work for various companies as long as the
type of work performed is the same. One year from buying you should also avoid any major
purchases such as a car, boat, or anything that would take away from your income. Although you
may have the money, lenders will often view this as limiting your funds.

Now is the time to get serious about a down payment. Although most lenders will provide
options from 3% to 5% down, keep in mind that the more you can put down the better. If you
could put down 10% that would be great and 20% would be even better. The more you put down,
the less balance will be financed with an interest rate. That means you are saving not only on the
monthly payment but the overall price of the house. Additionally, you want to have a minimum
of three months income, more if possible, in your savings account.

Talk to a lender to determine the types of loans you would qualify for as well as any special
programs available. Some of these may provide you with a free appraisal, lower down payment,
fewer points, first-time buyers, etc. There are many great programs currently available and by

knowing what works best for you, you can gear your planning with a little more precision. My
job is to help you navigate the buying process from ‘Start to Sold’!