If you're renting and tired of throwing your money away on someone else's mortgage, you may be wondering how you can become a homeowner now. While it's not an overnight process, there are a few things you can do to speed up the timeline and make your dream of owning a home a reality.
1. Get your finances in order.
The first step to becoming a homeowner is to get your finances in order. This means paying off any outstanding debt, including credit cards, car loans, and student loans. You'll also need to start saving for a down payment, which is typically 20% of the purchase price of the home. If you can't afford to put down that much, you may still be able to qualify for a loan with a smaller down payment, but you'll likely have to pay private mortgage insurance (PMI), which will increase your monthly payments.
2. Work on your credit score.
Your credit score is one of the most important factors lenders will consider when determining whether or not to approve your loan. If you have a low credit score, work on improve it by paying your bills on time, keeping your balances low, and only applying for new credit when necessary. You can get a free copy of your credit report from each of the three major credit bureaus every year at AnnualCreditReport.com.
3. Shop around for a mortgage lender.
Not all lenders are created equal and shopping around can save you thousands of dollars in interest over the life of your loan. Be sure to compare rates, terms, fees, and closing costs before choosing a lender. Once you've found a lender you're comfortable with, get pre-approved for a loan so that you know exactly how much house you can afford before beginning your search.
Conclusion: Owning a home is an achievable goal if you're willing to put in the work upfront. By getting your finances in order, working on your credit score, and shopping around for a mortgage lender, you can make your dream of homeownership a reality sooner than you think!