We are buying a house WOOT WOOT… now, how do we pay for the thing?

As referenced in my earlier post, Mr. A and I are buying a house this year! What I did not tell you is we are buying a house VERY soon.  Since we are going through the process of buying our first home I thought I would blog about it and see if anyone has any advice. It is overwhelming to say the least. A little help from y’all would be great.

We have begun the process of getting pre-approved for a mortgage. We meeting with the broker next Wednesday and we are spending a lot of time this weekend preparing all of the documents needed to apply for all the different loan types. We found this broker through my office. I work for a real estate related regulatory agency, and was referred to this broker through the best contact I know. I am sure we are working with a great person. I do know this; don’t just go with anyone off the streets. There are a lot of shady people out there. 

Here is the breakdown of everything we need to bring:

1.        2008, 2009 and 2010 tax returns with W-2s. If you decide to do any first time homebuyer programs, three years of tax returns are required.

2.       Most recent one month of paycheck stubs.

3.       Two months of bank statements from each bank account.

4.       Most recent retirement and/or investment account statements.

We are considering several loan options:

1)      The first and most likely will be FHA. If you don’t know much about FHA you are with me. I have been doing lots of research on this and the basics are that we can put less down, there are stiffer qualifications, and restrictions but the money is backed by the Government. 

2)      The other option will be to do a traditional 30 year fixed mortgage and put more down on the house. We could do anywhere from 5% to 20% down. We can do this, but we will be wiped out of our house fund. I anticipate there being a lot of other little costs involved in the home buying process and I am not totally sure I want to throw everything we have at the down payment.

Some additional factors that I think might come into play and get us a great rate are that we have almost perfect credit, and no debt. Right now a lot of people can’t qualify for a mortgage because of their debt to income ratio and ours is well within the approved rage for all mortgage types. We also have a long credit history so I think we should be able to get the best rates, probably better than most.

So there you have it. We are real life adults and we are moving forward with this process. I hope after analyzing all of this and thinking about every angle we have not left anything out and we end up getting approved for like $50K.

Does anyone out there have any advice or thoughts on the pre-approval process?