5-Step Checklist for First-Time Homebuyers in Durango and Cortez, CO
For many, being a first-time homebuyer can be both an intimidating and frustrating experience. While the stakes are high, you can’t, in good conscience, make an impulsive purchase. You also can't directly contact the selling agent of an online listing you have spotted and say, "Dibs!" Or could you make an offer on the first open house that you will attend? There are many things to prepare for while getting ready before scheduling a showing and making an offer on the home of your dreams.
In this article, we will discuss a five-step checklist that first-time homebuyers should memorize when starting their search for a home in Durango and Cortez, Colorado.
Key Takeaway:
- Your Paperwork Needs to Be in Order
- Re-Check Your Credit Score
- Get Pre-Approved
- Draw Up a List of "Must-Haves" and "Would-Like-to-Haves"
- Hire a Trusted Real Estate Agent
1. Your Paperwork Needs to Be in Order
Before you even start looking at online properties, you should have all of your paperwork in order, especially if you plan to apply for a mortgage. Some documents will need to be prepared, including bank statements, the last two years' worth of tax returns, any canceled rent checks, and the current pay stubs of your current lease rental. These documents will be required by the mortgage officer when assessing your borrowing capability. Gathering all the paperwork early can be a hassle, so get a head start on the competition.
Real Estate expert Bill Gassett of Massachusetts Real Estate News provided excellent advice for those contemplating their first home purchase.
"If you're serious about purchasing a home, you should always get preapproved before setting foot in a property. Getting preapproved not only lets a seller feel confident you can buy their house but also provides buyers with a price point they should be looking at. No Realtor wants to show homes to a buyer who doesn't qualify for that purchase. Doing so literally wastes everyone's time. When first meeting with a potential buyer, I always ask them if they have gotten their preapproval letter. It sets the tone for our relationship. I explain the importance so everyone is on the same page right out of the gate."
2. Re-Check Your Credit Score
Your credit score is one of the biggest factors when it comes to securing a loan. Lenders will look at your score to determine whether you are creditworthy, which will affect the down payment, interest rate, and other mortgage terms. It will also help you know what type of loan you can qualify for, as different loans have varying credit score requirements. Check your score and obtain a copy of your report before browsing real estate listings. If you think there are errors in your report, contact the credit bureau to report them. For those with poor credit, take steps to improve your score, so you can secure better loan terms for your ideal home.
3. Get Pre-Approved
Try to avoid starting your home search without a mortgage pre-approval. This letter will tell you how much home you can afford and show sellers that you’re serious and financially capable of buying. Lenders will review your employment, credit, income, and assets before issuing a pre-approval, so gathering all the necessary paperwork upfront will save you time and hassle. Getting pre-approved gives you a competitive edge and speeds up the homebuying process. With the current market’s low mortgage rates and limited housing inventory, it’s more important than ever. Having a pre-approval before making an offer ensures sellers that the deal is likely to go through.
4. Draw Up a List of "Must-Haves" and "Would-Like-to-Haves"
The next step is to think about your lifestyle and priorities. Create a list of features you want in a home and categorize them into two groups: must-haves and would-like-to-haves. The must-haves may include things like preferred square footage, number of bathrooms and bedrooms, and ideal neighborhood features. These are the non-negotiables. The would-like-to-haves might include things like a home office, an outdoor patio, and other desirable features for you and your family.
5. Hire a Trusted Real Estate Agent
Lastly, don’t go through this process alone, especially in today's market. Work with a trusted real estate agent who can help you act quickly when you're ready to move. Find a Realtor who has a solid understanding of the Durango and Cortez area, especially if you’re limited on time or need guidance in these regions.
Bottom Line
Once you’ve reviewed this homebuying checklist, you're ready to take the next steps! Start by reviewing current mortgage rates to determine what you can afford. Use this guide to help you navigate your home search and follow these five steps to find your dream home in Durango or Cortez. Trust your real estate professionals to guide you through finding and settling down in your perfect home in these beautiful and thriving Colorado towns.