Buying your first home is one of the biggest financial decisions you’ll ever make. But with so many steps, it’s easy to feel overwhelmed. At Walters Financial Wellness, we believe the key to a smooth home-buying experience is a clear plan and smart financial preparation.

 

Here’s a step-by-step money guide to help you navigate the process with confidence:

 

1. Assess Your Financial Health

Before you start house hunting, get a clear picture of your current finances:

• Check your credit score. A higher score can help you qualify for better mortgage rates.
• Review your debt-to-income ratio. Lenders want to see you can comfortably manage a mortgage alongside existing obligations.
• Evaluate your savings. Ideally, you’ll need funds for a down payment, closing costs, and an emergency buffer.
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Tip: Aim to keep your monthly housing costs (mortgage, insurance, taxes) under 30% of your gross income.

 

2. Set a Realistic Budget

Work out how much house you can afford before falling in love with a dream property. 

Consider:

• Down payment: Typically 3–20% of the home’s purchase price.
• Closing costs: Expect 2–5% of the loan amount.
• Ongoing costs: Maintenance, utilities, property taxes, and insurance.

 

Pro tip: Use a mortgage calculator to model different scenarios.

 

3. Save Strategically

Once you know your target number, build a savings plan:

• Automate your savings. 
• Set up a dedicated account for your down payment.
• Cut unnecessary expenses and redirect the funds toward your home goal.
• Explore first-time homebuyer programs. Many states offer grants, tax credits, or low-interest loans.

 

4. Get Pre-Approved for a Mortgage

A pre-approval letter shows sellers you’re serious and gives you a clear price range. Then, spend some time shopping around for lenders (This will not hurt your credit). Compare fixed vs. adjustable-rate mortgages.

Make sure to ask about fees and timelines up front.

 

5. Find the Right Home

With your budget in hand, work with a trusted real estate agent to:

• Identify neighborhoods that fit your lifestyle.
• Attend open houses and ask about long-term value.
• Avoid emotional buying! Stick to your numbers so you don't go over-budget.

 

6. Close with Confidence

Once you’ve made an offer:

• Review the inspection report carefully.
• Make sure you understand your closing documents.
• Keep your finances stable. Avoid big purchases or new debt before closing day... it's a requirement from lenders.

 

7. Plan for Life After Closing

Your financial journey doesn’t end at the closing table. Here are some items focus on after closing:

• Start (or rebuild) your emergency fund.
• Budget for new homeowner expenses.
• Consider a long-term financial plan to balance your mortgage with savings and retirement goals.

 

Final Thoughts

Buying your first home is about more than just the keys. It’s about building a foundation for your future. At Walters Financial Wellness, we help first-time buyers create a financial plan that feels empowering, not stressful. Ready to start your home-buying journey? Contact us today for personalized guidance and take the first step toward your dream home!