Hello, my name is Jill Edlich and I am a Realtor, aka “Jersey Jill, The Jersey Girl With The Southern Charm”. I got my license about 4 years ago and I love to help people buy and sell their homes. Buying a home doesn’t have to be a scary event. I walk my clients through every step of the way from beginning to end. Doing your homework and preparing months in advance of deciding to purchase is best.

1. The first thing I tell my clients is that they should first check their credit. The homebuyer’s credit score is one of the most important factors when it comes to qualifying for a loan these days. Doing a little damage control can go a long way. Make sure there are no mistakes on the report, unpaid accounts, or collection accounts. Repairing damaged credit takes time. Six months before you are thinking about purchasing, you should try to begin the repair process or earlier.

2. It’s good to track your spending for a few months and see where your money is going. Knowing your monthly cash flow is key. You should also understand that if you are self-employed or straight commission you may have a more difficult time getting a loan than others. General rule of thumb is being able to track at least 2 years worth of earnings history to provide to the lender.

3. As a homebuyer you should be able to document income and taxes. Lenders will ask that you provide at least 2 recent pay stubs, 2 years worth of W2’s, 2 months of bank statements. Getting all your paperwork in order saves time when it comes time to sit down and talk to the lender.

4. As a first time home buyer, you really should have somewhat of an idea of what you can afford. Calculating your debt to income ratio and factoring in a down payment will give you an idea of how much you can afford to purchase the home and what your monthly payments will be. There’s an old standard that says that no more than 28 percent of your gross monthly income be devoted to your housing costs, which is called your front end ratio. The back end ratio shows what portion of income covers all monthly debt obligations.

5. Figuring out your down payment is also important. Some loans require one, some don’t. There are programs that can assist buyers if they have qualifying incomes and situations. It’s best to ask friends, family and even your Realtor, who they would recommend. It’s ok to shop around. Buying a home is a big investment. It takes time to do the preparing. I tell my clients that once all these tasks are being accomplished, any big purchases, personal loans, or credit cards should not be done. Buying the new furniture for the home you’d like to purchase should be delayed until after you have obtained the loan. Any changes to credit can hinder or stall your chances of obtaining a loan. Having these kinds of conversations is key to making the flow of purchasing a home run smoothly.

Contact: Jill Edlich, jill@jerseyjill.com, 973-975-3253