Whether you are a young Gen X, an older Gen Z, or one of the many Millennials in between, chances are your parents may not have told you everything you need to know about buying a house.

1. You Don't Need 20 Percent Down

When your parents bought a house, they were probably required to have a down payment of 20 percent or more. However, for most loans, a large down payment  is no longer necessary. In fact, there are many loan products that require three to five percent down and a few that even have options that don't require down payments.   

2. Your Credit Score Matters

Your credit score is one of the key deciding factors in loan approval, yet your parents may not have talked to you about your score and why it is so important. The reason may lie in the fact that credit scores did not even exist before 1989.

Your credit score tells the lender how well you manage money and whether you pay your bills on time. You should know what your score is before you begin to house hunt and work on repairing your credit if your score is low. You can get a free copy of your credit report here.  

3. Hire a Realtor

Hiring a real estate agent that works exclusively with home buyers, or a buyer's agent, is always a wise choice. A buyer's agent helps you with the process of hunting for a house as well as through the often overwhelming steps of the closing process.

As an added bonus, buyers do not pay the agent any commission. The seller actually pays both agents. When he or she lists their home for sale, they agree to pay six to seven percent commission (depending on where in the country they live). The seller's agent then splits that commission with the buyer's agent when the house sells.

4. Be Unconventional

A conventional loan is a standard loan issued from a bank or credit union. Conventional loans have strict guidelines, and not everyone may qualify for them. This does not, however, mean that you should give up on your dream of homeownership. On the contrary, there are plenty of unconventional options. Government-backed loans, like VA, FHA, and USDA loans, are all designed for borrowers that have previous military service, have less-than-perfect credit, are in a lower income bracket, or live in a rural area.

While your parents are a great resource to start asking questions to about the home buying process, don't stop there. Learn as much as you can to have a smooth transition to homeownership.

To learn more about buying a home, contact real estate agents in your area like those at Weichert, Realtors - Bev Young & Associates.

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