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The first step is:
Pre qualification & Pre approval:
The first time home buyer must be ‘pre-qualified’ even before searching a home. Prequalification means to know exactly the kind of house one can afford and Pre-approval shows the seller that First Time Home Buyer is serious borrower and can meet the mortgage payment. Then the lender gives a letter stating that the loan is for a certain amount for certain time period.
Applying for Home Mortgage loan:
When you apply for the first time home mortgage loan their are many factors which are related to it they are your income, your credit history as well as any debt. According to some lenders says that in general the debt and expenses should not be more that 30-40 % of your gross income. Before applying for the home mortgage you need to check the financial situation as to how much you can afford and choose a payment plan so that it can helpful in fulfilling future goals.
Down payments:
The most difficult part in approval of first time Home Buyer Loan is Down Payment.
Down payment mean the first time home buyer should pay some % of amount and rest will be paid by the bank. The lenders of first time home buyer loan charge at least 20% of home's value as a down payment. Some times it happens that lenders can accept lower down payment if the buyer opt for private mortgage insurance.
There are different programs available with Zero down payments and some who charge unto 3%, 5 -10%% down payments.According to some site the different programs for First time home buyers with down payments are
Zero Down Payment Programs:
Zero Down Loan Programs
Fannie Flex 100% Expanded Approval Program
Teacher Zero Down Program 3 % down payment programs:
Fannie 97 Program,
FHA Loan Program,
FHA 2-1 Buy down Loan Program.
5% -10%down payment program:
Piggyback Loan Program-No PMI
10% Down payment program:
First Time Home Buyer Credit Challenge and many more.
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