A great year to purchase a home

With today’s super-low mortgage rates, it can still be a great time to make the transition from renting to homeownership. But where should you start your homeownership journey? As with just about anything in life, preparation is key. If you’re thinking about buying a home, here are a few things you’ll want to do before you begin your home search.

Order your credit report. Under federal law, you are entitled to one free credit report each year from all three credit reporting bureaus: Experian, Equifax and Trans Union. Simply go to Annualcreditreport.com to request your free copy, which you can access within minutes online. Your credit report details your payment history – the good and the bad. Mortgage lenders use credit information, along with your income, debt load and other information, to help determine not only whether you qualify for a home loan but how much home you can afford. Now’s the time to check your credit report for any errors in your credit report and report any inaccuracies. Contact each credit-reporting bureau to get any errors fixed as soon as possible.

Order your credit score. The next thing you’ll want to do is obtain your credit score, the three-digit number representing the quality of your credit record. When you order your score, you will be given specific tips on how to improve it. Consider this your action plan; these are the things that will help you improve your score the most. You can order your score from any of the credit-reporting bureaus, or the credit-scoring company Fair Issac.

Keep your debt manageable. Now’s not the time to purchase new furniture for the entire house or purchase an expensive recreational vehicle or travel trailer. The goal is to keep the amount of your available credit that you use as low as possible in relation to your overall credit limits. Once you are approved for a home loan, you’ll want to avoid any big purchases during the underwriting process and before closing day.

Make payments on time. Making payments on time can have a big effect on your credit score. In fact, the last two years’ worth of payment history is one of the most important factors in your ability to qualify for the lowest mortgage rate possible. This is a good time to be especially vigilant about paying bills on time.

Visit us BEFORE starting your home search. There are two great reasons to apply for prequalification from Element Funding before you start looking for a home. By visiting us first, you will know how much home you can afford. You won’t waste your time looking at homes that aren’t in your price range. Second, you’ll be able to confidently make an offer on a home. Home sellers typically don’t want to field offers from home buyers who haven’t yet lined up their financing.

Whether you’re thinking about buying this year or sometime in the future, let’s talk! At Element Funding, we’ve helped individuals and families across the country become homeowners. You can reach us at: (360) 903-7890