In today’s competitive market, there is a lot of upfront work that needs to be done before beginning on your journey to buy a home as a first-time military homebuyer. Homes are selling quickly and sellers often receive multiple offers from prospective homebuyers. It’s no easy task for a first-time military homebuyer to navigate this competitive housing market alone, however with the right information and expert advice you’ll be better prepared for success.
Before taking the plunge into home ownership, here’s what you need to know and the mistakes to avoid.
1. Know Your Credit Score
A common mistake of a first-time military homebuyer is not knowing their credit score. Your credit score is especially important if you are planning to finance your home. Lenders look for good credit scores because it shows that you are likely able to pay your mortgage on time.
If you are planning to finance your home with a VA loan, your credit score does matter. VA-approved lenders have credit score minimums, and a higher score will offer you better interest rates. So, the sooner you check your credit score the better. If you find out it’s not where it needs to be to borrow, you’ll have time to correct any errors and take measures to boost your score. Learn how to check your credit score here.
2. Know What You Can Afford
The next important step in beginning your home-buying search is understanding what you can afford. A general rule of thumb is that a first-time military homebuyer can afford to purchase a home up to 3 times their annual household income. It’s also important to consider how much you receive for your BHA and the cost of living where you are looking to buy. In some cases, your BHA may cover most of your mortgage payment.
To get a more detailed idea of what you can afford with your military salary, start by using a mortgage calculator and then getting prequalified for a mortgage. Taking these steps are a quick and easy way to see how much you may be able to borrow and prequalification proves to sellers that you are serious about purchasing a home.
3. Research The Area
You should start researching where you want to live and homes that you are interested in purchasing as soon as possible. In this market, you need to make fast decisions, so it is best to have a clear vision of what is important to you, such as proximity to the base, school options, distance to the airport, etc. After you are pre-approved for a mortgage, you can then narrow down options for possible neighborhoods, based on the type of home you can afford and be ready to act as soon as the right home hits the market.
4. Connect with a Military Friendly Agent
Buying your first home can be complicated, intimidating, and time consuming. Connecting with a Realogy Military Rewards agent can make it easier. These agents understand the military PCS lifestyle and VA loan process and can answer questions and guide you through all the steps you should take on your path to homeownership.
Your Realogy Military Rewards agent is well versed in your local market and can provide you with local knowledge including the most up-to-date listings directly from the MLS before the listings are available on other websites. Your real estate agent will also provide you with guidance on how to navigate the home-buying process and how to submit an attractive offer in this competitive housing market.
Get Started Today!
Realogy Military Rewards is ready to support you with all of your home buying needs. In addition to working with an expert agent, you can earn $350-$7,500 in cash back after closing and get local community insights from military and veteran families at PCSgrades.
When you’re ready to get started on your homebuying journey, please call 1-800-752-3642 to speak with a Realogy Military Rewards Advocate or visit Realogy Military Rewards today and hit “Sign Up”.