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Your first home and where to begin.

Whether you are buying your first home, or you’ve bought before, there are steps you want to take before you ever walk into a banker or realtor’s office.

First, get a copy of your credit report.  Your credit score is based on the items in your credit report, and the higher your credit score, the lower your interest rate.

You can get a free copy of your credit reports, once every 12 months, at annualcreditreport.com .  There are three national credit reporting agencies:  Equifax, Experian and TransUnion.  Many credit reports contain errors, so dispute any incorrect information.

Next, make a list of your monthly living expenses.  Include everything, such as savings for periodic expenses like car repairs, tires, gifts for holidays and birthdays, vacations and entertainment.  Add up all your monthly living expenses and compare that with your total monthly take-home pay.  Determine how much you can realistically afford each month for a house payment.

Remember, you will have property taxes and homeowner’s insurance when you buy a home.  Ask your lender if the monthly payment amount they quote includes taxes and insurance.

Many first time homebuyers only budget for the home loan payment, forgetting taxes and insurance.  Also, just because you qualify for a certain loan amount doesn’t mean you can actually afford it.  So buy a home that is priced right for your budget.

Remember, realtors and lenders make a commission based on a percentage of the sales price, so they want you to buy as much house as possible. Protect your family budget, and buy only what you can realistically afford.

Finally, consider how much down payment you can make.  Depending on the loan type, credit history, and other factors, you must make a down payment of 3% to 20%.  Neighborhood Housing Services of Oklahoma City has down payment assistance programs (their number is 405-231-4663) for qualified home buyers.

Good luck and happy house hunting!

Chris Poole –

Chris has been with CCCS of Central Oklahoma for over 5 years and is our housing expert.

CCCS is a non-profit Credit Counseling agency with offices in Bethany, Enid and Tinker Air Force Base. Contact us at http://www.cccsok.org or 1-800-364-2227

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