Buying your first home can be exciting. However, the process can be long and stressful, especially with financing. The more you plan, the more your mortgage process will go smoothly. Here are tips for first-time buyers looking for a mortgage lender.

1. Negotiate

As of 2022, millennials represent 43% of homebuyers, the highest share of any generation, according to the National Association of Realtors. If you're a millennial and a first-time homebuyer, don't be afraid to use your leverage in terms of negotiating a better mortgage rate. While there is a general asking price a seller has for a home, it doesn't mean it's set in stone. If you have a house you really want to buy and a seller wants to get it off their hands, don't be afraid to negotiate the price for a better deal.

2. Shop for Rates

You don't have to take the first mortgage lender you see. Mortgages come at different rates, so do your due diligence to shop around. It's a good idea to get at least a few different mortgage rates you're interested in and compare terms.

3. Check Credit Rating

Your credit rating will affect your mortgage approval. Some programs will allow a lower credit score, but be mindful that the higher the credit score you have, the less interest you'll pay on your mortgage. In other words, your credit score can make a difference between paying only 3% in interest versus 7%.

4. Be Realistic About What You Can Afford

Regardless of what a mortgage lender approves you for, be realistic about what you can afford. In addition to paying your mortgage every month, you'll still have to pay taxes and utilities. When you close the deal, you'll also have closing costs. Even if you're buying a new home, you'll likely need to do some updates and repairs sooner than you'd like, so make sure you have an emergency cushion set aside.

With the right planning, you can find the right mortgage lender for you. Follow the above steps to avoid falling into any pitfalls such as buying a more expensive home than you can afford. For an experienced mortgage provider who can help walk you through the process, contact us today at Rick Valdez, Loan Officer, NMLS #105548 for more information.