New homebuyers guide for the Greater Birmingham Area—all you need to know

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new homebuyers'guide
Tammy Mularski + Justin Drake (Jacob Blankenship / Bham Now)

Thinking about buying a home in the Greater Birmingham Area but aren’t sure where on earth to start in this crazy market? We reached out to the experts at Prosperity Home Mortgage and RealtySouth for our new homebuyers guide. Here’s what they told us.

First things first: meet the experts

We know homebuyers are wondering where to start, along with if or when they’ll be able to afford to buy a home, given the high prices right now.

Top 10 tips for getting yourself ready to buy a home: new homebuyers’ guide

New homebuyers guide
Looking for your first home is a lot easier with the right people supporting you. (RealtySouth)

You may be surprised to learn how much of getting ready to buy a home starts years before you ever start looking. The majority of our experts’ tips all have to do with getting your credit and loan paperwork sorted.

1. It’s never too early to start building your credit

  • If you’re in college and your parents pay your rent, you’re missing an easy opportunity to begin building your credit. Instead, ask your parents to put money in your bank account so you can write the rent check. This will give you a rental history that will qualify you for certain programs that will make it much easier when you’re ready to buy a home. 
  • Parents, add your child to your credit card as an authorized user to help them start building their own credit.

It goes without saying that your mortgage lender can help advise you in the process of preparing to apply for a loan.

2. If your credit’s not great, go ahead and start fixing it

Your mortgage consultant can advise you on how to repair or improve your credit, whether that’s paying down your cards, getting a secured loan or credit card, credit repair, or another strategy.

“My goal is to build them up. I always tell them—it’s more than just buying this house. We’ve got to get your credit in a good place so you can buy a car, or anything else, without being taken advantage of with high interest rates. This is about educating you and improving you for the rest of your life.”

—Justin Drake, Prosperity Home Mortgage, LLC

A better credit score translates into a better interest rate when it comes time to buy your home.

New homebuyers guide
Being prepared makes a huge difference as a first-time homebuyer. (RealtySouth)

3. Get preapproved for a loan so you can develop a budget

Preapproval shows you how much you can be approved a loan as you begin the process—this will help you come up with a budget to suit your needs. You’ll also need to be prepared for an escalation in prices, as sellers often have multiple offers to choose from.

Want to get started on the process of getting ready to buy a home? Reach out to Prosperity Home Mortgage, LLC, today.

4. Make a game plan to get from point A to point B

For example, let’s say you’re self-employed and haven’t filed tax returns yet. You’ll need two years’ worth of tax returns to be able to get a mortgage, so you’ll need to get those filed. This will give you and your lender a clear picture of your income to see if you qualify for the house you want.

5. Become a pre-qualified borrower

This is where the lender sends your file to their underwriting department. Underwriting is where the bank does everything they need to do to get ready to make a loan. This puts you in a strong position when you’re going up against multiple offers, because your loan’s already been underwritten.

“Depending on the customer and their situation, there are different avenues we could take. It’s important to sit down with the customer and educate them on how to do this. My goal is lifelong credit—to be able to prepare them and help them their whole life—not just to do a mortgage.” 

—Justin Drake
New homebuyers guide
It’s important to have the right people around the closing table with you. (Jacob Blankenship / Bham Now)

6. Talk to your mortgage lender about down payment and loan options

There are so many options, from FHA, USDA, conventional and others—your lender can help you come up with a plan. 

7. Work with a Realtor who’s ready to hold your hand through the whole process

“The main thing for first-time homebuyers is that you’ve got to walk before you can run. Having a real estate agent like Tammy who’s patient and willing to help you out—that makes a huge difference.”

—Justin Drake
New homebuyers guide
What kind of community do you want to live in? (The Bama Buzz)

8. Start looking for your first home

Here are some key things to remember when you begin your home search:

  • You may need to look at more than one location that works with your budget. 
  • Take the time to look at several communities that may give you the same feeling you’re looking for for your first home. 
  • Remember, your first home likely won’t be your forever home. 
  • Look for a house that will be a good stepping stone, meaning it’s in an area with good resale value, so you can build equity. 

9. Ask your Realtor anything

You need to know what you’re signing and what everything means—if your Realtor slips into terminology you’re not familiar with, don’t hesitate to ask questions. It’s their job to take the time to explain everything to you. 

10. You may have to make offers on more than one home before your contract is accepted

People are purchasing homes above listing price, so be prepared for some rejections when you make offers on homes you’re considering.

“I really do try and educate my buyers on what’s going on with the market and interest rates and different loans.”

—Tammy Mularski

Start getting your credit ready so you can make the best offer possible. Reach out to Prosperity Home Mortgage, LLC, today

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