8 Helpful & Simple "First Time" Home Buyer Tips

Here is a "thumbnail sketch" of 8 really important things to do when you are even THINKING about purchasing a home for the first time. I know this list is a bit preachy, but remember... You want and need  to know this!

1. Pay all of your bills on time in the last 12 months or more, if not on time, no more than 1 or 2 - 30 day "lates" in a 12 month period. It is possible to have dinged credit and still get a mortgage, but you may pay a little more in interest! Another thing to consider...if you are having issues just keeping up on your bills, that might be a good sign to wait until you have them under control.
2. Have at least 3 good "trade" lines of credit - They include car loans, credit cards (secured or unsecured) , Gas Cards, Department Store Cards, Cell Phones. Many people with no debt in this form are often shocked you really need "debt" to build credit. The credit scoring formula requires that you have some debt and pay it month to month to show that you are responsible.
3. Set up a savings account, and make it your initial goal to save 5% of your purchase price. It can be done with less of course, but when you start saving you start prioritizing the way you live! The more you can put down on the house, the lower your interest rate and mortgage insurance.
4. Be cautious of having unexplained "non-regular" deposits in your checking or savings accounts, as it will look like an informal loan has taken place and most underwriters may need an explanation letter about each one.
5. Analyze a realistic payment zone for you before you meet with a lender. Such as 20-25% of your gross monthly income, and put some budget numbers on it, so you can know if it works for you in the REAL world, not the on paper world, as some lenders will want to qualify you for the highest possible mortgage, and history has shown the industry that much of the time that the allure of the bigger home can intoxicate, even the most conservative buyers. & You don't want to be strapping yourself down with too much mortgage debt, which is really un-needed stress!
6. Talk to at least 2 local mortgage lenders as their rates and fees can vary, but tell them what you are doing. It is most likely not a secret, but be direct and that honesty will help you build trust with them.
7. Choose a competent real estate agent, not always a friend, or relative. It may be easier to look at them during a Holiday dinner, but they they should be experienced in the business, not just available and in need of some money.  
8. OK, here is your 1/2 a tip (Ask people you trust, who they would hire as a Realtor or Mortgage person, a personal referral is powerful and it sets the tone of the entire relationship, as they want to make sure that they live up to the reputation that proceeds them.