First Time Buyers

Also, E., just remember that the federal government extended a program for first time buyers and (certain other buyers) that provided tax incentives. I think it goes through April, so you might want to check into that as well. A mortgage broker could probably provide you with the info.

The first thing you should do is contact a mortage lender/broker. You could go to a bank if you choose, but with a mortage broker deals with many lenders and your chance of securing the type of loan that best meets your needs is much greater. You'll meet with them and give them all your financial information, income (a good idea is to have your last 2 pay stubs), list of assets, list of creditors, the balances you owe your creditors and your monthly payments. They'll run your credit reports and advise you what the range of the loan you could qualify for based on the current rates. They'll also advise you if there's anything you need to clean up on your credit report. Since the banking colapse, they may require much more documentation at this point then they did years ago.

I highly recommend you get your free annual credit report before you meet with them. Review the report to make sure it's accurate.

I can't stress this enough..... make sure you read the fine print and fully understand what their talking about. Take some time to read some of the articles in the money sections of msn.com or aol.com and become familiar with the terminology.

Remember that the rates change daily, so from the time you start the process to the time you secure the loan the rates will change. Also, they are just "pre-qualifying" you. There is no guarentee that you will get the loan.

After you have the pre-qualifying amount, start house hunting. Once you find the house you want to purchase, you will then officially apply for the loan.

Good luck.

I'm not exactly sure what you are asking, but it was the same for our first home as it was for our refinance. The lender will ask up front (and verify on your credit report) if this is your first home. We worked with a broker, but in getting quotes from banks originally, the process was similar. If you don't have a particular house in mind, the financial institution you are working with will give you a letter stating you are prequalified for a loan of a certain amount based on qualifying information you disclose to them (annual household income, debt, etc.). Once you do have a particular house in mind, the lender will start the approval for the loan, requiring documentation that you are still employed, account numbers for any account you are using for funding or proof of income, verification of past addresses (if you haven't been in the same place for 5 years), etc. You'll get a quote for the closing costs which can be ~1.5 - 3% of the loan that you would need to pay to acquire the loan. After the closing costs and the downpayment, the bank will require that you have some amount of money remaining in your cash flow. I forgot what this was based on as our first time around, we were balancing the books down to the penny to have enough cash. Ask your lender.

I suggest you go to a mortgage lender/broker instead of a bank since they can shop around for rates and packages. You go before you start looking at housing to get preapproved for a loan (this will help when your agent submits your offer) and once your offer is accepted you work out the paperwork with the lender to get the funds by the time Escrow closes.

You've gotten some great advice so far. I just wanted to add that we had to get some help from my parents with our first house when we first got married. I remember borrowing from my dad the closing costs which I think were about $2500. I had to get a gift affidavit from him to show that he was "giving" us the money rather than acquiring another debt. So, if you are borrowing from family, you might have to do this. I also had a bunch of student loans from college that my dad was paying. He had to show proof with one year's worth of cancelled checks that he was the one paying them instead of me.