Steps to Take to Go From Renting to Owning

January 3, 2017

Steps to Take to Go From Renting to Owning

The decision to purchase a home is big deal. If you’ve been a renter for a number of years, you must adjust your mindset to that of a homeowner. Being tied to a lease or contract is nothing compared to the long-term commitment of home ownership. Because it’s a major milestone in your life, there are several ways you can get ready to take the plunge. Follow these steps to go from renting to owning your own home:

  1. Pay down your debt. As a lender looks at your financial situation, he will determine your debt-to-income ratio as part of his calculations. Decreasing your debt helps in the approval process AND makes it easier you when it comes time to pay your mortgage. Diminishing your debt also helps build up your credit score, which is essential to getting a loan with preferable terms.
  2. Save for a down payment. Most lenders ask for 20 percent of the purchase price up front, however there are some programs where you will pay as little as 3 percent. Either way, you need to save for a down payment.
  3. Find a real estate agent. Interview several agents and ask them about the services they provide, their certifications and success rate in selling homes in your price range.
  4. Make a wish list. Think ahead about the amenities, size, style, location and price range of the home you are interested in. Establishing some basic criteria will help you considerably during the home search.
  5. Get pre-approved for a loan. Most sellers won’t even want to talk to you, until you get pre-approved by a lender. Your real estate agent can refer you to lenders in the area.

Consider these other useful tips for home ownership from the Main Street Organization of Realtors.

For more information or to begin your home search, contact ProX Realty today at 620.249.5767.