{"id":5304,"date":"2020-04-05T13:31:03","date_gmt":"2020-04-05T20:31:03","guid":{"rendered":"https:\/\/blog.neighbor.com\/storage-blog\/first-time-home-buyer-loan\/"},"modified":"2024-01-29T17:46:18","modified_gmt":"2024-01-30T00:46:18","slug":"first-time-home-buyer-loan","status":"publish","type":"post","link":"https:\/\/www.neighbor.com\/storage-blog\/first-time-home-buyer-loan\/","title":{"rendered":"The Ultimate Guide to Getting Your First-Time Home Buyer Loan"},"content":{"rendered":"\n

For most people, their first home buyer loan is the largest sum of money they have ever dealt with. Buying a home can be stressful, time-consuming, and expensive (especially if moving to a new city<\/a>). <\/p>\n

It is also very exciting and incredibly rewarding. You can reduce the pain and increase the pleasure of home buying by simply educating yourself on the process. There is nothing scarier than not knowing what to expect, but by preparing yourself, you can proceed with confidence. And so, with that in mind, here is the ultimate guide to getting your first-time home buyer loan. <\/p>\n

Neighbor<\/a>'s Ultimate Guide to Getting Your First-time Home Buyer Loan will go over the following:<\/p>\n

    \n
  1. How Does Home Buying Work?<\/li>\n
  2. What Types of Assistance Can First-Time Buyers Receive?<\/li>\n
  3. How to Find a Good Mortgage?<\/li>\n
  4. How to Prepare for Your First Home Loan<\/li>\n
  5. Tips for Your First Mortgage Loan<\/li>\n<\/ol>\n
    <\/source><\/source>\"First<\/picture><\/figure>\n

    How Does Home Buying Work?<\/span><\/h2>\n

    Do not feel bad about asking this question. To some, it may seem obvious, but if you have never owned a home, you are probably wondering: How does home-buying work?<\/p>\n

    The short answer is that home buying happens mostly through loans. Yes, there are cases when home buyers offer cash for a property, but that is rarely true for first-time buyers.<\/p>\n

    The most common type of home loan is called a mortgage. You can get a mortgage home loan, just like any other loan, through a commercial bank. Some smaller banks will also offer mortgages and, depending on your credit and financing situation, it is sometimes worth shopping around. <\/p>\n

    What Is a First-Time Home Buyer Mortgage Loan?<\/span><\/h3>\n

    A mortgage is, essentially, a long-term loan—one of the longest, in fact. Most mortgages last between 15 and 30 years. There are also cases when lenders offer 40-year mortgages, but those are less common. Because of the amount of money you need to borrow and the decades it takes to pay it off, interest rates are a big consideration for most first-time home buyers. You can easily find the average mortgage interest rate<\/a> in your state by doing a little research. This time and effort will pay off because when you go for your mortgage, you will know what to expect.<\/p>\n

    What About Down Payments?<\/span><\/h3>\n

    Down payments are an important aspect of buying a home, especially if it is your first one. Many young buyers assume they are going to need to put loads of cash down to move forward with buying their homes. In reality, this is not always the case. With a typical commercial loan, you will usually need to put down about 5% of the total loan cost, and with an FHA loan, you usually only need to put down about 3.5%.<\/p>\n

    This is not to suggest that you should not<\/em> put down more money than the average amount. There are many people who aim to put down 20% or more on their first home. This can be a good idea as it can reduce the amount you have to pay in mortgage insurance. On the other hand, it is not necessarily wise to drain your bank account on a home purchase. Yes, you should plan and save for your home, but you should only put as much money into your down payment as you can comfortably afford. That means having enough left over to pay for your other monthly expenses as well as some extra for “emergency” expenses.<\/p>\n

    What Is an FHA Loan?<\/span><\/h3>\n

    An FHA loan<\/a> is a mortgage that is backed by the Federal Housing Administration (FHA). FHAs are especially popular mortgages because of their low down payments—which can be as little as 3.5%—and the fact that they do not require as high of a credit score as traditional commercial loans.<\/p>\n

    If your credit score is 580 or higher, you will usually get accepted for a low-interest, low-down-payment loan. If your credit is not quite that high but is somewhere between 500-579, you can usually still qualify for an FHA loan. You will just need to put more money down on your mortgage—around 10% or more.<\/p>\n

    <\/source><\/source>\"\"<\/picture><\/figure>\n
    \n \r\n
    \r\n
    \r\n

    Can we pay you to store vehicles?<\/h2>\r\n <\/header>\r\n
    \r\n
    \r\n
    \r\n <\/path>\r\n <\/path>\r\n <\/svg><\/div>\r\n

    List your unused space<\/h3>\r\n

    People are earning $1,000s per year from their garages and outdoor space.<\/p>\r\n <\/div>\r\n

    \r\n
    \r\n \r\n <\/path>\r\n <\/svg>\r\n <\/div>\r\n

    Approve your renters<\/h3>\r\n

    You're in control. Approve who rents and the hours of access.<\/p>\r\n <\/div>\r\n

    \r\n
    \r\n \r\n <\/path>\r\n <\/svg>\r\n <\/div>\r\n

    Get paid monthly<\/h3>\r\n

    Sit back and collect automatic payments each month.<\/p>\r\n <\/div>\r\n <\/section>\r\n