First Time Homebuyer Guide
There's a lot to consider when buying your first home. There are also a lot of advantages, like state and federal programs designed to make your first home more affordable. But one of the greatest advantages you can give yourself is a mortgage pre-approval from Huntington.
We'll walk you through the homebuying process from start to finish, and explain the steps and people involved. We'll also introduce you to the pre-approval process, and how it works to make you a more attractive buyer.
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What are the steps to the home buying process?
The house buying process doesn’t begin with finding a house—it begins by becoming the most prepared buyer you can be. We’ll show you how to do that with a mortgage pre-approval from Huntington. First, here’s a general overview of steps involved in buying a home.
- Get your personal finances in order
This includes knowing your credit score and taking the steps you can to improve it, paying down debts, and creating a budget so you have a clearer picture of what monthly house payment you can afford.
- Saving for a down payment
Down payments can start as low as 3%, depending on mortgage product, eligibility, location, etc., with programs available for first-time homebuyers with smaller down payments.
- Discuss options for down payment or closing cost assistance programs‡
There are a number of government and non-profit programs available to help first-time homebuyers afford a down payment and closing costs:
- Federal Housing Administration (FHA) loans, offering down payments as low as 3.5%
- Veterans Administration (VA) loans, available to qualified veterans and their spouses with no down payment required
- USDA Rural Development loans, available to borrowers who purchase homes in rural areas and have low incomes
- Your state may also offer down payment assistance or grants to first-time homebuyers
Our Mortgage Loan Officers are specially trained to help you take advantage of these programs. Visit us at your local Huntington branch and we’ll be happy to answer your questions.
- Get pre-approved for a mortgage
This is a great step toward becoming a more qualified and prepared buyer before you find the house you want. We’ll walk you through the process, and you can apply online!
- Find a real estate agent
Your agent will work with you to identify your personal preferences, and your pre-approval letter from Huntington can help both of you search for homes with greater confidence.
- Start shopping!
House hunting can be fun and sometimes challenging, but when you find the perfect house, you’ll realize that being a prepared buyer pays off.
- Make an offer
You’re pre-approved and have found the right place. Your real estate agent will help put together an offer and present it to the seller’s agent on your behalf.
- Get an inspection
If the seller accepts your offer, it’s a good idea to get an inspection. The inspector will identify any problems with the property so you can negotiate with the seller to resolve those issues before you agree to close.
- Close on your new home!
This is where you sign all the necessary paperwork and become the official owner.
What are the benefits of getting pre-approved for a mortgage?
It makes you a more attractive buyer
Many housing markets are very competitive. A pre-approval letter shows you can secure funding, and that can give you an advantage with sellers and real estate agents who can afford to be choosy.
It lets you know your buying power
Lender pre-approval gives you a clearer understanding of how much house you can afford and can sharpen your home search.
It alerts you to lending roadblocks
Some people make an offer on a house only to be disappointed by personal financial issues down the road. Pre-approval helps you clear those hurdles from the start.
It can speed up the purchase process
Since you're pre-approved, you can move more swiftly into the home buying process when you find the right property.
First-time homebuyer FAQs
Answer: To get a mortgage pre-approval, you'll need to provide a clear picture of your employment, income, credit history, and debts. These are the documents most often requested:
Personal Identification
- Government-issued ID, such as a driver's license or passport
- Contact information for your current employer
- If retired, social security award letters, or proof of pension
- Pay stubs from the last few months
- W-2 forms or tax returns for the past two years
- If self-employed, Schedule K-1 forms showing income, losses, and dividends
- You will be expected to give consent to pull your credit report
- Statements for any investment accounts, retirement accounts, or other assets
- Bank statements from the last few months for any account that you will draw from for your down payment
- Information on existing debts, such as credit cards, loans, auto loans, student loans, or other mortgages
Answer: Here are the key people who may be a part of your journey to buying a home:
- Your real estate agent: Commonly called a buyer's agent, this person represents you—the buyer—in the purchase of a home. They will help you find available listings that fit your budget and preferences, negotiate the purchase price with the listing agent, and join you during the closing process.
- Listing agent: This real estate agent represents the seller of the home. They advertise the sale, negotiate the purchase price with your agent, and manage documents and closing.
- Mortgage lender: This is a representative of a financial institution (like Huntington) which provides the loan to purchase the home.
- Appraisers: These professionals determine the home's value to ensure that the lender does not loan you more money than the home is worth.
- Title company: Title companies work as agents for title insurers and will perform title examinations to determine if there are any issues with the ownership of the property, including any liens or claims against the property. They work to clear any known claims or liens and issue title insurance commitments and policies to cover certain unknown ownership issues or liens. Title insurance is usually required by the lender (a lender's policy) but homeowner's policies are also available. The title company oftentimes also serves as the closing agent.
- Closing agent: This person manages all legal and financial components of the sale. They ensure documentation is properly signed and funds are transferred from you to the seller.
- Real estate attorneys: A lawyer who represents your interests and reviews all legal documents.
- Tax advisors: Advisors who can help you understand the tax implications of purchasing a home.
- Home insurance agents: Your agent will help you select a homeowner's policy for your new property.
Learn about how to plan your financial journey
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