Larry Sells Tulsa
Larry Harral, CRS


With interest rates hovering near record lows, now could be a dream time to buy your dream home. But if you’re just starting out professionally or juggling student debt, the home buying process may be daunting. Here are some tips to ease your path.

Know your numbers: Take a look at your credit score. You can go to to get a complimentary credit report from each of the three largest credit reporting bureaus. You can also take a look at your TransUnion credit report, for free, at Generally, the worse your credit, the higher the interest rate you’ll have to pay. If your score is below 650, you might want to put your house hunting on pause to focus on paring debt and making sure all your bills are paid on time.

Find an agent: When you’re ready to start your search, you’ll need to find a real estate agent. Referrals from friends or associates make sense, but talk to more than one. You want someone who’s in the know about the market, and responsive to your questions in the way you find most comfortable, be it email or face to face meetings.

Nail down a budget: It’s a good idea to sit down with your agent or a certified financial planner to map out a realistic budget. For instance, a house hunter may fall in love with a $300,000 home that they can technically afford. But the monthly homeowners association fee to cover common expenses may be more than they bargained for. “It’s important to figure out what your lifestyle needs are, as well as what you’re looking for in a property before you . . . end up in a place that’s beautiful,  but you can’t afford to buy groceries,’’ says Jessica Houghton, an agent with Coldwell Banker in Atlanta, who works primarily with younger buyers.

“Lenders look to people to be well rounded and so having more than one line of credit is important,’’ Houghton says. Diversity – a credit card and a car payment, for instance as opposed to only a small stack of credit cards – is most ideal.  But be careful not to owe so much that it looks like you’ll struggle to pay your monthly house note.

Keep a lid on credit card use:  “If you’re keeping your monthly credit card debt at more than 30% of your limit, you’re looking like more of a risk to the lender,’’ Houghton says, “so I encourage people to get credit card payments under control.” Pay them off if you can, she says, and don’t  buy a car or make another debt-laden purchase at the same time you’re shopping for a house.

Be choosy:  Whether you attempt to pre-qualify for a loan, or look for a mortgage after you find a property, consider approaching the bank where you already do business first. “That should be the easiest route because . ..   they have all of your information,’’ Balonek says. Still, also think about looking at a few different lenders to make sure you secure a mortgage with the best terms. You also want someone who get backs to you promptly since you will have a limited window to close the deal on your new home.

Seek assistance:   Ask your lender about programs available to novice buyers, such as those aimed at particular fields. “There are certain loans for different industries,” , says Brian Teach, an Orlando-based real estate agent for Coldwell Banker, “educators, teachers, nurses, firefighters’’ as well as physicians. Often there is a salary cap and other requirements. But “there are certainly benefits to going through those programs.’’

Consider FHA: If you can’t come up with a hefty down payment, Federal Housing Administration insured-mortgages allow some borrowers to put down as little as 3.5%  – but you’d need a credit score of at least 580. If your score falls between that number and 500, you’d need to come up with 10% down. And below 500, you likely wouldn’t be able to get the loan.  Remember those monthly premiums for the FHA insurance will last for the life of the loan, unlike private mortgage insurance – also known as PMI – which cancels out once the remaining principal reaches 78% of your property’s original value. So you can possibly buy a home for less, but you will carry that extra tab until you’ve paid off the loan in full.

–Charisse  Jones


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