This might be the year you’ll always remember. The year you bought that forever home, a dream for many that could be your reality. With the right plan.

Get Your Finances in Order

Begin by checking your credit report for inaccuracies. A Consumer Reports survey found that 44% of people who checked theirs found at least one error. If you’re one of these people, we recommend researching how to rectify these errors.
Pay down existing debt. Ideally, you want your debt-to-income (DTI) ratio to be 43% or lower. Both the debt snowball method and the debt avalanche method are solid strategies for lowering your DTI.

How much house can you afford?

It may be more than you think, but it could be less. One of the best ways to know for sure is through mortgage pre-approval. Your lender can inspect your finances and determine an appropriate loan amount before you begin your search.

Take Stock of Your Savings

According to the National Association of Realtors’ (NAR) 2024 Profile of Home Buyers and Sellers, 25% of first-time home buyers use a gift or a loan from a relative or a friend for their down payments. 69% use savings and the average down payment for first-time buyers between July 2023 and June 2024 was 9%.

However, you’ll need cash for more than a down payment and closing costs (which are typically between 2% and 6% of the loan amount). Cash reserves are important; it’s wise to have emergency funds that equal three to six months’ worth of living expenses.

Seek Expert Advice

About one in five homebuyers contact a real estate agent as their first action. 86% of all buyers use agents. Why so high? Agents know local markets, have access to homes you might not find online, and bring expert negotiation skills when it’s time to do a deal.

What mortgage programs are popular with first-time home buyers?

The NAR found that around 90% of first-time homebuyers finance their purchases with mortgages. Here’s the breakdown:

  • 52% choose conventional loans. Commonly, people who select conventional loans put down up to 20% of the purchase price.
  • 29% choose FHA loans. With lower credit score requirements, FHA loans can be easier to qualify for, with down payments as low as 3.5% of the home’s price.
  • 9% choose VA loans. With no down payment requirement and backed by the U.S. government, VA loans are often the go-to option for service members and their families.

Why wait until 2026 or beyond when 2025 could be the year you achieve homeownership? To learn how, call us at (972) 591-3097 or connect with us online.