Thursday, January 7, 2021

Expert Advice for First-time Home Buyers

When it comes to buying your first home at Lake of the Ozarks, you likely won't be in a position to do it with cash this time around. Therefore, you're going to need to secure a mortgage loan in order to make that first home purchase. Obtaining your first mortgage is exciting, but it can also come with its fair share of challenges if you're not prepared. As such, the best mortgage lender at Lake of the Ozarks, Team Lasson is here with a little expert advice to help set you up for success.

Manage Debts Diligently

Efficiently handling your debts by making continued payments over the years or paying down a lump sum of debt can help keep your debt-to-income ratio low. Your lender will be looking at this ratio during the mortgage qualification process to determine qualifying ability. Ensuring you're handling debts such as student loans, car payments, credit cards, etc., will help you maintain a lower debt-to-income ratio.

Practice Good Credit Habits

Your credit score is a large determining factor in your mortgage qualification process. When you miss payments on debt obligations that you owe, you're negatively impacting your credit score. A good practice for maintaining good credit is to create a ledger for monthly debt obligations and ensure that they are met each month. This will allow you to qualify for better mortgage loan programs and rates.

Consider Refinancing/Consolidating Student Loans

One loan that may be near impossible to pay off before you're ready to purchase your first home comes from student loans. These large balances and payments combined with the commonly lower income of first-time homebuyers/fresh college graduates make it difficult to manage in a short amount of time. Refinancing or consolidating your student loans can be an effective way to reduce the payment amount, thus lowering your debt-to-income ratio. However, you'll have to decide whether you want to extend the length of time you're paying those debts vs. securing a mortgage loan.

Keep Good Records

There is a lot of documentation required during the mortgage loan process. So, keeping solid records of your financials such as tax returns, bank statements, brokerage accounts can help give you an advantage when it comes to document collection. You'll also find the documents useful when you're first meeting with your mortgage lender - and they'll be thankful you have them upfront too!

Save Cash for Upfront Costs

While there are loan options to finance a vast majority of a home purchase, you will still be liable to cover closing costs and applicable down payment at the closing table to finalize your mortgage loan. Closing costs can include but are not limited to, appraisals, home inspections, surveys, county/state transfer taxes, property taxes, and even homeowner's insurance premiums. So, while you're making that expense ledger for your debt obligations, be sure to allocate a little money aside to help save for these costs.

As a first-time homebuyer, you'll likely have many questions about the mortgage process. As your premier mortgage lender at Lake of the Ozarks, Team Lasson is here to assist you with your home financing needs. We will work with you every step of the way to get you the best financing options to suit your home buying need. So, if you're considering buying your first home at Lake of the Ozarks, we would be happy to provide you the first-class service you deserve!

Michael Lasson
Senior Loan Officer
NMLS #: 493712

4655 B Osage Beach Parkway
Osage Beach, MO 65065

**The postings on this site are my own and do not necessarily represent First State Bank of St Charles’s positions, strategies, or opinions.

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