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Tips to Help You Buy Your First Home in Texas

First time buyers have a lot of uncertainty when it comes to buying a house. After all, what you know about mortgages, home values, and other financial terms can change in an instant. That’s why it’s so important to have a solid plan in place and an experienced mortgage broker in Texas before you start to look for houses.

Buying a house in Texas may be a wonderful experience, especially for first-time buyers. However, before you start exploring listings or attending open houses in Texas, there are a few things you should keep in mind as a first-time homebuyer.

That’s a common fact that first-time buyers have a lot of uncertainty when it comes to buying a home. After all, they’re unsure about their knowledge about mortgages, home values, and other financial terms that can change in a flash. If it’s your situation – you should have an experienced Texas mortgage broker on your side.

The first step to buy a house is – getting pre-approved by a local Texas lender.

This is the recommended step in the path of a first-time homebuyer since it allows you to understand where you stand financially and provides you with a knowledge of today’s market. A lender’s pre-approval or pre-qualification letter will inform you how much money the lender is willing to lend you for the house purchase. This information, together with the amount of cash on hand, will provide you with an accurate estimate of your price range.

If you are not sure where to start looking for a reliable Texas mortgage lender – you can rely on recommendations from family, friends, and coworkers. This is a good way to start, but you should also shop around yourself until you find a local Texas lender who offers the best loan alternatives for your personal and financial goals.

Why a local mortgage broker is better than an online lender who can ‘save you money’?

A local mortgage brokers will look through your finances with you, to evaluate what sort of Texas property you can buy and what loans you could be eligible for. They will also explain the different loan options and inform you of current interest rates, helping you to set a reasonable monthly payment plan that suits your budget.

The next step in the home buying process is understanding what you want. After getting pre-approved – you’ll be ready to work with a local real estate agent to find your perfect Texas property. Defining your desires and needs with a real estate agent is an important first step in finding a house where your family will grow.

In order to narrow down your Texas property search, you’ll need to make a few decisions.  Some people want to live in the county, while others want to be near a city. Do you like old homes, renovated ones, or modern designs? Are you an animal lover or an environmentalist? Understanding your entire budget, current lifestyle, area attractions, and neighborhood amenities are all important considerations.

Once you know what you’re looking for, you’ll be able to narrow down your list of potential houses.

What Is Financial Assistance for First-Time Homebuyers?

When looking for homes, many first-time homebuyers are eligible for financial assistance. The government offers low interest loans to help you buy your house. One of the main programs is the FHA loan. FHA loans are offered by banks, mortgage lenders, and even the federal government to assist with home affordability. Some other programs that offer assistance include the Rural Development Agency (RDA) and the Department of Agriculture (USDA).

The FHA Home Loan

The government offers low-interest loans to help you buy your first house. One of the leading programs is the FHA loan – a government-backed mortgage that’s insured by the Federal Housing Administration. Other programs that provide assistance include the Rural Development Agency (RDA) and the Department of Agriculture (USDA).

FHA loans are one of the most popular programs for first-time buyers because they provide lower down payments and more flexible credit guidelines than other types of loans. The average down payment for an FHA loan is 3.5%. That’s about $4,500 for a $150,000 house. The minimum credit score required to qualify for an FHA loan is 580.

Why FHA is a good option? You could qualify for up to $300,000 in a mortgage when other homeowners only qualify for $250,000. Why? Because the FHA will guarantee up to 97% of the home loan amount.

VA Home Loans

Private lenders such as banks, mortgage brokers, and direct lenders make the VA Mortgage program available to qualified Texas Veterans. 

Here at LBC Mortgage, we’re pleased to provide competitive rates on VA Loans to Texas Veterans.

The benefit of a VA Home Loan is that the VA guarantees a portion of the mortgage, protecting the lender from damages if the borrower defaults. This means that qualifying Veterans can access competitive VA guaranteed to finance for their home purchase or refinance. This typically involves no-down-payment financing for the purchase of a property, as well as not having to pay monthly mortgage insurance. In most cases, they will also get a competitive interest rate.

You might have the impression that all VA mortgage loans are not-for-profit, but this is actually not the case. Yes, there are VA loans that are backed by government guarantees, but these guarantees do not make them cost less than a regular loan. In fact, they can be more expensive than other types of mortgages. 

Keep in mind, that if you take out a VA loan and then decide to sell your home before you have paid it off in full, you could owe money at the time of sale–as much as $23,000 if you have only lived in your home for three years or less.

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Conventional Home Loans

Before you buy a house, it’s important to know what kind of mortgage you qualify for. Conventional home loans are the most common type of mortgage and offer fixed interest rates with plenty of flexibility. However, the down payment may be higher than other types of loans. For example, a fixed-rate loan may require a 10 percent down payment, such as ITIN loans, VOE loans, Texas Stated Income Loans, and Texas bank statement mortgage programs. While an adjustable rate mortgage (ARM) only requires 3.5 percent down. Find out which type of loan works best for your finances and plans.

Other Types of Financial Aid for First-Time Homebuyers in Texas

There are many other types of financial aid for first-time homebuyers in Texas. If you want to buy a home but don’t have the money, there are some options out there that might be helpful.

Some buyers turn to their employer to ask for a loan or company sponsored housing. You could also talk to your bank or credit union about what resources they have available. Be sure to shop around and look at offers before settling on anything. For example, some banks offer 100 percent financing, while others will require you to pay a percentage of the house price upfront.

A lot of government programs are geared towards assisting first-time homebuyers with their down payment and monthly mortgage payments during their first few years of ownership. This can make it much easier for those who don’t have the savings or the income needed to purchase a house outright like past generations used to do. You should reach out to your local county office in order to find out more information on how these programs work and whether or not they apply in your area.

We also provide DSCR loans in Texas for investment properties, which you can use for short-term rental on Airbnb.

We Will Guide You With Every Step of The Way

There are many financing options available to help homebuyers in Texas purchase their property. If you are considering a first-time homebuyer loan, you may want to visit the HUD website for Texas for more information about these options.

Are you ready to start looking for a home? With this knowledge about how to buy a house in Texas, you should be prepared for the upcoming adventure. 

If you have questions or would like to know more about your loan options in Texas as a first-time homebuyer, contact our Texas mortgage broker today and let us help you get a better rate for your first home! 

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