First Time Home Buyer here! No idea what I'm doing.

Okay, I'm 23 years old, and I'm looking to buy a house. I've done a little research, and know I need to get a pre-approved mortgage. But, I don't know how to even begin to do that. I don't even know what questions to ask.

Any advice from any experienced home buyers, especially first time home buyers? I figure, a $50-$60k house is cheaper per month than renting an apartment, why not?

 

I found a good Realtor.

 

Im 24. I bought a house last year. Im also a mortgage underwriter( the guy who says Yes or No). Buying now is smart. To get a pre- approval go into wherever you normally bank with a paystub and w2. Ask to meet with a branch loan officer. They will input you income the price of the house you plan to purchase and that amount of cash you wish to put down. Might take a couple days but they should send you a pre-approval letter.

 

Try to find a broker or agent and they can get the ball rolling for you.
I was in the same position you're in, so I went and got my real estate license. Did the transaction myself through a broker friend of mine.

 

I'm a home mortgage processor. Maybe I can help.

The first step is to know exactly what you're looking for. Getting a preapproval is key to knowing you can get the loan in the first place. They will run the numbers and tell you what you can afford based on income, tax returns, liabilities, and credit history. The pre-approval is done using a desktop underwriter or DU. It's a program that calculates risk and tells you whether or not the lender will loan you the money given the circumstances. Then to find a realtor who has a good reputation, and make sure you know how much his/her office charges and if it's in your budget. Let them know exactly what you want, size, area, taxes, condition, etc. They will pull up all the MLS results for properties matching your criteria and show you the listings. When you find a home you like, you can apply for a loan with a mortgage company, broker shop, or bank. Realtors will often suggest using their lenders, because it makes the process run smoother.

A typical approval takes about a week after you supply the mortgage company with all the necessary documentation for the type of loan that best fits your needs. After you are approved for the loan amount you are trying get, you can place an offer on the house and open escrow if the offer or counteroffer is accepted. In my company, loans usually close within 30 days, and escrow usually the same if not a little more. Once escrow is closed and you have signed the paperwork and the title is transferred to you, you can move in.

Hope that helps. Best to consult a certified Realtor. Not just a real estate agent.

 

I think the first step is the find a good realtor, ask friends and family if they know anybody good in your area. Also, see what type of state mortgage programs you might have, and don't rule out getting a mortgage from local banks. This is just my personal experience but I would try to avoid getting a mortgage through a broker.

My wife and I bought our first place a few years ago and wouldn't have had a clue without our realtor to help us. We first applied for a mortgage through a mortgage broker who did a terrible job, so we dropped him and found a local bank who found us a great mortgage rate through a state-owned program.

 

I agree about contacting a Realtor. That is what they do, and if you find a good one you will be in good shape. I will say that if I didn't get bounced around so much for work, I wish I could've bought a double block in a nice area when I was your age. A friend of mine did that, he lived in one side and rented the other. His tennant paid his mortgage and he basically lived there for free. Then he moved out, rented both sides, and bought a single family home after he got married. He makes a decent amount off that rental property.
I know things don't always work out that nice (finding a good deal, tennant, etc.), but it worked for him. Another friend of mine is in the process of doing the same thing.
I didn't end up buying until I was married and we didn't want to worry about who is on the other side, moving, etc. But when I was single I wouldn't have cared about that. haha

Good luck!! Just take your time and don't rush through the process, do your research. It is a big decision and responsibility.