Spring is a season of fresh starts, and that includes your finances! If buying a home is one of your 2025 goals, now is the perfect time to clean up your budget, improve your credit, and get financially prepared. The homebuying process is easier when you have your finances in order, so let’s break down how you can get ready step by step.
Step 1: Check Your Credit Report and Improve Your Score
Your credit score plays a big role in getting approved for a mortgage. It affects the interest rate you’ll receive, which determines your monthly mortgage payment.
🔹 Check your credit report for errors – You can get a free credit report at AnnualCreditReport.com. If you see mistakes, dispute them immediately.
🔹 Pay down debt – Reducing credit card balances can improve your debt-to-income ratio, making it easier to qualify for a loan.
🔹 Avoid new debt – Don’t take out new loans or open credit cards before applying for a mortgage. Lenders like to see financial stability.
Step 2: Create a Realistic Homebuying Budget
Buying a home comes with more costs than just a mortgage payment. Factor in:
💰 Down payment – Most loans require 3-5% down, though some programs allow 0% down.
💰 Closing costs – These range from 2-5% of the home’s price.
💰 Property taxes and homeowners insurance – Costs vary by location but must be factored into your monthly payments.
💰 Maintenance and repairs – Unlike renting, homeownership comes with upkeep responsibilities.
Step 3: Increase Your Savings
A strong savings plan will help cover unexpected costs.
✅ Set up automatic savings transfers to a high-yield savings account.
✅ Consider a side hustle or freelance work to increase your income.
✅ Use your tax refund or work bonuses to boost your home savings fund.
Step 4: Get Pre-Approved for a Mortgage
A pre-approval tells you how much home you can afford and strengthens your offer when you find a home you love. Lenders will review your:
📄 Income and employment history
📄 Debt-to-income ratio
📄 Credit score and financial stability
Spring is the perfect time to refresh your financial habits and move closer to homeownership. The earlier you prepare, the smoother the homebuying process will be. Need help planning your next steps? Follow me on Instagram @shakema.therealtor and book a FREE consultation call with me today!
