Loading

Your First Steps Toward Buying a Home

Your First Steps Toward Buying a Home
Updated on
March 24, 2021

When preparing to buy a home, the first thing many home buyers do is look at the real estate ads in newspapers, magazines and listings on the Internet. Some potential buyers read how-to articles like this one. However, the next thing you should do, before you call on an ad, before you shop for interest rates or talk to a realtor, - is look at your savings.

Why?

Because determining how much money you have available for down payment and closing costs affects almost every aspect of buying a home - including how you write your purchase offer, the loan programs you qualify for, and shopping for interest rates.

Home Loan Programs

If you only have enough available for a minimum down payment, your choices of loan program will be limited to only a few types of mortgages. If someone is giving you a gift for all or part of the down payment, your options are also limited. If you have enough for the down payment, but need the lender or seller to cover all or part of your closing costs, this further limits your options. If you borrow all or a portion of the down payment from your 401K or retirement plan, different loan programs have different rules on how you qualify.

Of course, if you have enough for a large down payment, then you have lots of choices.

Your loan choices include such varied programs as conventional fixed rate loans, adjustable rate mortgages, buydowns, VA, FHA, graduated payment mortgages and all the varieties of each.

Finding the Lowest Interest Rates

A very important reason you need to have at least some idea of your down payment is for shopping for interest rates. Some loan programs charge a slightly higher interest rate for minimal down payments. Plus, the interest rates for different loan programs are not the same. For example, conventional, VA, and FHA all offer fixed rate loans. However, the rates vary from one program to another.

If you shop lenders by phone, the loan officer will be able to tell you which programs fit and quote your rates accordingly. However, if you are shopping on the Internet, you have to develop some idea of your loan program on your own.

Writing Your Home Offer

Another reason you need to have a clue about your down payment is because it affects how you write your offer to purchase a home. Not only are you required to put your down payment information in the offer, but also different loan programs have different rules that also affect how you write your offer. This is especially important when dealing with FHA and VA loans.

If you are asking the seller to pay all or part of your closing costs, you have to be certain your loan program allows what you are asking. For smaller down payments, lenders allow the seller to pay less closing costs than for larger down payments. Some loan programs will allow a seller to pay certain types of costs, but not others.

Finally, your down payment also affects your ability to qualify for a loan. When you make a small down payment, lenders are fairly strict about having you conform to their underwriting guidelines. For larger down payments, they will tend to make allowances or exceptions to the rules.

Getting Ready to Buy a Home

As you can see, the down payment affects every choice you make when you buy a home. Although you should look at ads, familiarize yourself with neighborhoods, learn about prices, and read as much as you can - when you get ready to take action - the first thing you should do is figure out how much money you have available for the purchase.

Schedule an Appointment

Additional Financial Considerations
from Financial Experts

No items found.
Your First Steps Toward Buying a Home
How to Buy a Home
Whether your first second, or dream home, we find you the perfect property.
First steps to buying a home
We sell your home quickly & efficiently getting offers for your property.
Preparing to buy a home
We find you the perfect office & commercial location for you.
How to buy a new home
Amazing Luxury Real Estate throughout Texas
How to buy a new home
Find the best residential, commercial & land investments.
how to prepare to buy a home
We help you relocate your home, business & life to Houston.
What you need to do to buy a home
Mortgages, Titles,  estates. Learn more about purchases.
what you need to do to buy a house
Contact us for help with your real estate sale or purchase.

Texas Real Estate Information & Categories

the right property, the first time
Find your next property

Contact us to find your next property. We find you the best beginner or luxury home or commercial & business real estate opportunities.

Check out these other great blogs & sites

ADWilliams RealtyBlox NewsFrankly LegalCPGIO Ecommerce ServicesPaleo RanchRemus LawThe ProfessionalistTrustablesXclusive CollectiblesZara Law Group
home for sale on, New luxury Construction in Texas, New builds in Cypress
For Rent
For Sale
Luxury Home Build in Cypress, TX
10931 Water Hyssop Lane
new luxury listing in Cypress Texas, new home build or sale in Cypress, Luxury real estate in cypress TX
3
Bedrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
2
Bathrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
For Rent
For Sale
New Luxury Home Construction in Cypress, TX
13811 Friarstone Pointe
new luxury home listing in Cypress Texas, new homes for sale in Cypress, Luxury homes in cypress TX
5
Bedrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
5.5
Bathrooms
12714 American Sweetgum Way, New home Construction in Texas, New Home builds in Cypress
For Rent
For Sale
New Home Construction
12714 American Sweetgum Way
ew home listing in Cypress Texas, new luxury homes in Cypress, Luxury homes in cypress TX
4
Bedrooms
12714 American Sweetgum Way, New home Construction in Texas, New Home builds in Cypress
3
Bathrooms
Contact Our Texas Real Estate Experts Today

Schedule a Free Texas Real Estate Property Consultation

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
10931 Water Hyssop Lane for sale Luxury home construction
For Rent
For Sale
Luxury Home Build in Cypress, TX
10931 Water Hyssop Lane
new luxury listing in Cypress Texas, new home build or sale in Cypress, Luxury real estate in cypress TX
3
Bedrooms
home for sale on, New luxury Construction in Texas, New builds in Cypress
2
Bathrooms
Luxury real estate for sale in houston
For Rent
For Sale
Newly Built Luxury Home
11706 BRANDON WAY
Houston luxury homes for sale
5
Bedrooms
Luxury real estate for sale in houston
5.5
Bathrooms
Beautiful home in the Grand Lakes Community!
For Rent
For Sale
Lake View Property
7602 HAMPTON BAY LANE
Luxury homes in Grand Lakes
4
Bedrooms
Luxury real estate in Katy TX
3.75
Bathrooms
Luxury Living in Timberlake Village!
For Rent
For Sale
Custom, One Owner Home
22918 TIMBERLAKE CREEK
Luxury real estate in timberlake village
4
Bedrooms
Homes for sale in timberlake village
2.5
Bathrooms

The Latest from the Walkthrough Blog

Pre move checklist
Moving can be incredibly stressful, but it doesn't have to be. With a little bit of preparation and planning, it's possible to streamline the entire moving process. Start by breaking down the move into manageable tasks and setting an overall timeline for when everything should be completed. Ready to create a stress-free plan for your move? Follow these tips from Pride Street Realty Group.
Home Ownership
Upsizing Your Home for a Growing Business
As a home-based business owner, it’s always exciting to watch your business grow and expand. But as your business grows, you may find that your home is no longer sufficient to support your needs. Whether you need more space for inventory, a dedicated home office, or a professional place to meet with clients, upsizing your home might be the solution you need. Moving into a bigger home is a major decision, so it’s important to plan your upgrade carefully. Check out the following tips to ensure your upsizing process goes as smoothly as possible.
Tips For Buyers
Understand Mortgage Processes and Paperwork
Buying or selling a home is an exciting period in everyone’s lives, but it can become overwhelming quickly, especially when it comes to keeping track of the paperwork. Misplacing documents can lead to closing delays or missed deals. To make sure you make it through the process as smoothly as possible, here are some helpful tips from Pride Street Realty on how to keep up with the paperwork that comes with the home buying and selling process.
Tips For Buyers
starting over in a new city
Embracing a vibrant new city can be an exhilarating prospect, especially if you've recently been through a hard time. Beginning anew in an unfamiliar place could feel overwhelming, however, which is why having a plan and smart advice is key for making the most of this fresh start. To help you out on your journey, Pride Street Realty has put together a few helpful tips that will make the process a little easier.
Tips For Buyers