Five Tips to Prepare to Buy a Home

Whether your goal is to buy a home this year or in five years, you can begin setting yourself up for success now.

1. Save for a down payment or open a high-yield savings account: A high-yield savings account typically will pay 10x more in interest rate than a regular savings account. If they generate 4%-5% annual percentage and you save $10,000, you can earn between $400-$500 per year in interest.
2. Reduce your debt-to-income ratio: Monthly debts/ Monthly gross income = DTI ratio. To be approved for a home loan, your debt to income ratio should be around 36% or less. Work on getting closer to this percentage by paying down your debt, increasing your income, or both.
3. Improve your credit score: The higher your credit score, the more likely you are to be approved for a home loan. To build your credit score:
   1. Utilize 30% or less than your credit card max
   2. Pay debts and bills on time
   3. Reduce your DTI ratio
   4. Dispute any errors in your credit report
4. Knowledge is power: Understanding the current market and home buying process will be extremely helpful when buying your first or next home. Find a trusted real estate agent to answer your questions and guide you through the process.
5. Figure our your priorities: Decide now what is most important to you for your home and lifestyle. Search homes at https://ownutahre.com after all, it doesn’t cost you anything to look! Enjoy the process!

This post is for informational purposes only and is not a substitute for professional advise from a licensed attorney, tax professional, or financial advisor.