My wife and I recently joined the proud club of first-time homeowners pursuing our slice of the American Dream. We don’t yet have the white picket fence, and our dog is a dachshund instead of a golden retriever, but we’re making progress.

As a financially conscious individual, the prospect of owing a bank hundreds of thousands of dollars in exchange for some dirt, wood, and concrete is utterly terrifying. I realize there are processes (laws) in place to ensure The Man can’t come around any time he likes to evict me from my home, but nonetheless I feel as though I am no longer a free man. In all likelihood, I will feel this way for the next 30 years. Or at least until I win the lottery and buy a gaudy McMansion with cash.

My wife, on the other hand, has never been more excited. Painting the walls, decorating, and coming home every evening to something that’s “ours” are just several of the seemingly thousands of reasons why she is so eager to own a home. This is also precisely why we are a good couple. She thinks with her heart while I think only about the numbers.

For those of you who 1) have never bought a house before, or 2) haven’t bought a house in many years, a word or two of advice… it is easier to acquire weapons-grade uranium than it is to borrow money from a bank. After the mortgage crisis, banks don’t want to loan you money and they will do everything they can to avoid giving it to you. 

I have heard that retirees have an especially difficult time qualifying for loans because they don’t have a steady stream of income (doesn’t matter how many millions they have squirreled away in investments or in their savings accounts). In my case, the unusual nature of my compensation as a “1099 employee” instead of a standard W2 employee was cause for consternation. Our mortgage rep required pages and pages of additional documentation to verify my income. On-top of this, she told us not to buy cars, not to open credit cards, not to deposit large sums of money, so on and so forth. In essence, we were to live in a cave and forage for berries in the woods until the mortgage was approved. 

With all of that in mind, here are a few nuggets of wisdom I wish I had before we got started:

• Don’t settle on the first house you lay eyes on. Set a target timetable of 3-6 months to find “the perfect house.” As first time homebuyers, you are likely moving out of an apartment or other temporary dwelling which affords you great flexibility in when you move. You will regret rushing this process.
• Shop around for the best overall “deal” on your mortgage. Some companies will offer a lower rate, some banks might offer to pay some of your closing costs in exchange for a slightly higher rate. Depending on your financial situation, either option might be best. Ask lots of questions of your mortgage representative. A good one will be communicative throughout the process and will give you straightforward answers.
• Put at least 20% down, period. We had planned on doing this anyway, but banks look at you with a completely different lens if you tell them you’re only putting 15% down. Remember when I said they look for any excuse to deny your loan?
• Have every financial document you could possibly need ready ahead of time. Our mortgage rep asked for years of tax returns, investment statements, bank statements, W2s, my online dating profile (just kidding), et cetera.

All of that aside, owning a home carries with it numerous benefits. I personally am excited to have my own garage filled with a variety of power tools I will never use…

Submitted by Ben Sadtler