If you’re planning to buy your first home this year, you’ll want to get an early start and some expert advice. You’ll also want to have enough saved for a down payment and other expenses, and have a realistic idea on how much home you can afford. Ideally, your housing expense should not exceed 30% of your monthly income.

To get started, try our online home affordability calculator. Then contact an AMS Military Mortgage Advisor, a licensed loan officer, to go over the numbers and discuss your homebuying time frame. Remember, the shorter your time frame, the more you’ll need to set aside each month.

Related: 6-Month Countdown to Your New Home

Step 1: Prepare Your Finances

While many Members have a good grasp of how much they’ll need for a down payment, which can be zero if you qualify for a VA or USDA loan, there are other expenses to save for, including:

• Earnest money deposit, usually 1-2% of purchase price
• Application, origination, and underwriting fees (lender fees), some paid upfront, others at the close
• Down payment (if applicable), 3-10% or more
• Home inspection, $350 and up
• Pest inspection, $50-$250 and up
• Appraisal, $500 and up, varies by location. Caps apply to VA Loans.
• Closing costs, about 3-6% of the purchase price
• Moving expenses

Lenders will ask you for your current bank statements during the underwriting process to ensure you have enough money in those accounts to cover these costs, plus two to three months of mortgage payments.

Experts also suggest putting aside 1-2% of your home’s value each month after you buy to cover any maintenance and repairs.

Related: Tips for Budgeting

Step 2: Get Pre-Qualified by a Lender

To make sure you’re on track to buy within your time frame, you’ll want to start working with a lender as early as possible. Find a lender and loan officer experienced with buyers like you (first-time buyers, military buyers, for example) and with whom you have established a good rapport. The loan officer should answer your questions about the home-buying process and let you know if your time frame is realistic based on your finances.

Related: 5 Smart Questions to Ask Your Mortgage Lender

A loan officer can do a “soft pull” of your credit to see if there are any red flags (late or missed payments, for example) or if there are a few quick ways to raise your score (like paying off some debt) so you can qualify for a better mortgage interest rate.

If your credit is already in good shape, a lender can verify your income and debt through third parties to pre-qualify you for a loan of up to a certain amount and provide you with a pre-qualification letter. While this is not a guarantee you’ll get the loan (and you don’t have to use any particular lender), a pre-qualification letter lets sellers know you’re serious about buying.

3. Work with a Good Real Estate Agent

To get access to listings, you’ll need to work with a real estate agent familiar with your desired location and experienced in working with military buyers. A good way to find your agent is through personal referrals or, if you’re new to an area, use an online tool like HomeLight.

Your agent will help you:

• Find a property
• Negotiate offers
• Address setbacks
• Make recommendations on other help you might need, such as a mortgage lender, real estate attorney, or home inspector

Once you’ve found a home you want to buy, you’ll submit an offer. Your Realtor® will be key in helping you make the offer attractive to the seller. If your offer is accepted by the seller, it’s time to reconnect with a lender (or two) to apply for your loan.

Each lender will have you complete a loan application and send you a loan estimate within three business days stating the terms of each loan, such as the loan amount, interest rate, and monthly payments. You’ll want to compare the loan estimates side by side to look for ways to save money and select the loan that’s right for you.

Stay Positive and Realistic

Buying a home is a process that can take months or even years. Don’t feel rushed if you’re not ready or just not finding a property and price you’re comfortable with.

And believe it or not, delays can happen right up until the time you’re signing the dotted line. To keep things moving, stay in close touch with your lender and respond promptly to their requests for updated documents or letters of explanation.

Once everything’s in place, your title company or real estate attorney will schedule a closing to go over the final documents with you and witness your signing (this is often done remotely).

That’s it, once you’ve signed you’ll be given the keys to your new home.

We’re Here to Help

Buying a first (second or third…) home is exciting, but it can also be complex and emotionally challenging. There’s a lot of paperwork, you’ll hear a lot of industry jargon, and the home search and buying process may be confusing and stressful.

Rest assured, we’ll be with you at every step.

Contact AAFMAA Mortgage Services LLC (AMS) using our online form or give us a call at 844-394-4526. We’ll be happy to provide you with an honest and fair comparison of your mortgage options, including a wide range of low-rate and low-cost mortgages designed to meet your needs.

And for those who are buying their first home, check out our tips for first-time homebuyers to help you with the process.