Starting on the road to homeownership can be a daunting task. That’s especially true for the first-time home buyer. Making sense of mortgage applications, interest rates, escrow, closing costs, negotiations and home inspections can all be overwhelming.

If you’re embarking on the journey to buying a house in the Atlanta area, the following are some key steps to take in the beginning phase:

  • Figure out what you can afford. Determine how much money you plan to spend for the down payment. This will typically be at least 5 percent of the price of the home. You’ll also need to factor in closing costs (all the costs associated with finalizing the loan), which normally amount to 2 percent to 5 percent of the loan amount.
  • Make sure your credit is in good shape. Are you a first-time home buyer who has blemishes on your credit record? Did you just buy a new car? If you answered “yes” to either of these questions, then it might be difficult for you to get a mortgage. Your credit history for the past year should reveal payments made on time and a lack of major purchases. However, it is important to have some credit activity to show your lender you are financially responsible by making timely payments and keeping your debt under control.
  • Get loan pre-approval. Once you know your credit is on solid ground, it’s time to get pre-approved for a loan. This means you submit all your financial information to your lender, who will then let you know if you can get a loan, and if so, for how much and at what interest rate. This is extremely helpful because it lets you know how much you can afford to pay. Although it’s nice to dream, you won’t waste your time looking at those houses you can’t afford.
  • Determine what neighborhood or community you’d like to call home. Whether you’re eyeing Clayton, Cobb, Paulding or Pickens county, if you’re moving to a new county or are new to Georgia, it’s helpful to do a lot of research and visit multiple neighborhoods and communities. Find out about schools, crime statistics, amenities and issues with transportation. Once you’ve found a few favorite neighborhoods, you will be able to better target your search.
  • Hire a real estate agent. The best way to land in the home of your dreams and get in the best position possible to make an offer is to hire a real estate agent. A professional knows the pros and cons of the various neighborhoods in the community, is extremely skilled at negotiating, and can guide you through every step of the often-complex home-buying process.

By arming yourself with the proper knowledge and having a professional real estate agent by your side, you’ll be ahead of the competition when buying an Atlanta-area home.

Image source: StockXchange