Ready to Buy a House? A 2-Year Home Buyer's Guide

Written By: Kelly Jaunet Jones

Need help with the home-buying process? You're not alone. Many first-time homebuyers feel they don't have the money or the ability to understand the process. It can seem like everyone else is getting their life together while you're left behind. Social media and news often say that the window for people to become homebuyers has closed.

 

That's just not true.

It's not an if. It's a when. With time, a plan, and some knowledge, it can be done.

We're here to help you cut through the noise and simplify the path to homeownership. With a clear, step-by-step plan, you can feel confident and prepared to buy your first home in two years.

Here are the basics:

1. Get your baseline.
2. Understand where you need to improve.
3. Take action to improve.
4. Educate yourself.
5. Build a team.
6. House hunt.
7. Close.
   

Year 1: Laying the Foundation

Get a Goal! You've likely been looking on Zillow and Realtor.com. Pick a house to give you a starting point. Is it a $300k house? $400k? $250k? Pick One.

Month 1-3: Assess Your Financial Situation

• Check Your Credit Report. Get a free credit report and check for errors.
• Create a Budget. Track your income and expenses to assess your financial health and identify areas for savings.
• Create a Document Hub. Whether it's a folder, a scan to a hard drive, or a drawer, keep your last two years' W2s, Tax Returns, and paystubs in one place.

Month 4-6: Start Saving for a Down Payment & Closing Costs

• Get your baseline. Log your savings and checking account totals.
• Open a Savings Account. Set up a dedicated savings account for your down payment.
• Set Savings Goals. Set your goals to be 3.5% at least for FHA minimum, 10% for a healthier downpayment, and 3% for closing costs.

Month 7-9: Reduce Debt and Improve Credit

• Get your baseline. Log all of your debt totals and the corresponding minimum monthly payments. Total those minimum payments.
• Pay Down Debt. Focus on paying off high-interest debt, such as credit card balances, while keeping the balances low.
• Student Loans. Look into an income-based repayment plan if the payments are too high.
• Avoid New Debt. Refrain from taking on new loans or credit cards.

Month 10-12: Research and Educate Yourself

• Learn About Mortgages. Understand different types of mortgages and their terms.
• Attend Homebuyer Workshops. Many local organizations offer free workshops for first-time homebuyers.

Year 2: Getting Ready to Buy

Month 13-15: Build Your Homebuying Team

• Find a Real Estate Agent. Look for an experienced agent who understands your needs.
• Consult a Mortgage Lender. Start the pre-approval process for a mortgage to know how much you can afford.

Month 16-18: Start House Hunting

• Identify Your Needs and Wants. Make a list of must-haves and nice-to-haves in a home.
• Visit Open Houses. Start visiting homes to get a feel for what's available in your price range.

Month 19-21: Make an Offer

• Finalize your Pre-Approval. Update your mortgage documents and get a final Pre-Approval Letter from your mortgage lender.
• Choose a Home. Once you find the right home, work with your real estate agent to make a competitive offer.
• Negotiate. Let your Real Estate agent guide you through the best ways to negotiate the price and terms with the seller.

Month 22-24: Finalize the Purchase

• Home Inspection. Hire a professional to inspect the home for any issues.
• Close the Deal. Work with your lender to finalize the mortgage and complete the closing process.

Close

By following this 2-year plan, you'll be well-prepared to buy your first home. Remember, an educated buyer is a confident buyer. We hope this guide gets you one step closer to confidence. 

Close on Your New Home with Leaders Credit Union

Are you ready to begin the two-year journey to homeownership? Reach out to our Mortgage Champions, who can help you navigate the steps you need to take for your dream home to become a reality. Be sure to check out our free Get Pre-Approved for Mortgage Guide.