First-Time Home Buyers Have One Big Hurdle to Overcome

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It’s no secret: Housing costs are expensive. Rising rents and a strong real estate market are making it harder for first-time buyers to get a piece of the American dream.

Buying a home means getting these four areas of your finances in shape:

  • Credit
  • Debt
  • Income
  • Assets

 

If you do not know where you stand and if you want to make an offer on a home, getting pre-approved is an important first step. Getting your financial house in order should be priority No. 1 if you intend on buying a home now or down the line. A pre-approval involves having a lender ensure that your credit score is sufficient, you have the cash to close on the home, your income supports the debt load plus your other liabilities, and you have the financial character and capacity to make a big-ticket purchase. While credit score, income, and debt allowance are all important puzzle pieces, your cash to close reigns.

Source:

http://www.realtor.com/advice/finance/first-time-homebuyers-have-one-big-hurdle-to-overcome/