is ready to answer any questions you have about buying a home in Wyoming. This homebuyer’s guide will cover the steps of buying a house, paying special attention to what Wyoming homeowners need to know.

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Figure out your finances

Your first step before buying a new home is to determine where you stand financially. You can’t begin an effective and realistic house hunt (much less put in an offer) until you fully understand your credit score, your debt-to-income ratio, and all of the fees included in the process.

It’s tempting to open Zillow right away, but hold off for now. First, gather your financial records, bank statements, and a calculator to figure out the kind of house you can afford in Wyoming.

Check your credit score

Before doing anything else, check your credit score. Your credit score is potentially the most important number when it comes to buying a house.

To buy a house in Wyoming with a traditional mortgage, you generally need a credit score of at least 620.

If your credit score falls below 620, you may qualify for a few other options:

Attempt to build your credit. This may be your best option if you are also trying to save up for your down payment. However, a lower credit score can still qualify you for a mortgage.

Apply for a Veterans Administration (VA) or Federal Housing Administration (FHA) mortgage, both of which accept credit scores as low as 500 and 523, respectively. VA mortgages are only available to eligible active service members, veterans, and surviving spouses.

Calculate your debt-to-income (DTI) ratio

After you check your credit score, your next task is determining your debt-to-income ratio, or DTI. Your DTI is calculated by adding up all your monthly payments and dividing the sum by your pre-tax income. What payments go towards your DTI?

Alimony or child support

Car payments

Credit card payments

Rent or house payments

Student loan payments

You will have a difficult time buying a home in Wyoming if you have a DTI greater than 50%. You want to shoot for a DTI of or under 36%, particularly if you’re wanting to qualify for a conventional mortgage.

Determine your down payment

Your down payment size is a significant factor in determining the kind of house you can afford to buy.

The kind of mortgage you qualify for will affect your down payment, just like most decisions related to buying a home. For conventional mortgages, you are generally required to have a down payment of 20% or higher.

If the 20% down payment is out of reach, there are more affordable mortgage options with Veterans Administration (VA) home loans or Federal Housing Administration (FHA) loans. Not sure of the difference? Here are the differences between the two:

VA home loan: mortgage insured through the Veterans Administration. Only offered to veterans, active duty service members, or surviving spouses if they qualify.

FHA loan: mortgage insured through the Federal Housing Administration. Offered to mainly low-to-moderate-income buyers, particularly first-time buyers.

You can have a down payment of only 3.5% with an FHA mortgage if your credit score is high enough, typically around 580. You could potentially have no down payment at all if you qualify for a VA loan! VA loans are also known for their low closing costs and interest rates.

Prepare for closing costs and other fees

Since you’re in the market for a house, you’ve most likely heard the phrase “closing costs.” How much should you prepare to pay upfront in addition to your initial down payment?

On average, closing costs in Wyoming are usually around 2-5% of the total home price. The average value of a home in Wyoming is $257,261, so closing costs should be between $5,145 and $12,863.

But what does this total include? The closing costs you pay along with your down payment will generally cover:

Credit report fee

Earnest money (a good-faith deposit going towards your down payment)

Home appraisal fee (typically required by your lender)

Home inspection fee

Homeowners insurance

Mortgage insurance

Mortgage origination fee

Property taxes

Wyoming has one of the lowest property tax rates in the US, averaging around 0.57% for the state. The exact rate you’ll have to pay will depend on the county you live in. For example, Teton and Johnson counties have rates as low as 0.47% and 0.5% respectively, while Fremont and Washakie counties both have a rate of 0.68%.

MORE: What is a closed end mortgage?

Key Takeaway Before you decide on a location, research the property tax rate of the county as well as general housing costs.

Look for homeowners insurance

We mentioned that homeowners insurance will factor into your closing costs, but it’s a significant expense you’ll need to pay every year you own your home. The average price of homeowners insurance in the U.S. is $115 per month, or $1,387 per year.

The cost in Wyoming is about $500 cheaper at a yearly average of $805 due to fewer weather hazards and low crime rates.

It may be tempting to sign up for the first affordable quote you get, but you’ll want to shop smart by comparing quotes from at least three different insurance providers. This way you’ll know you’re getting the best rate.

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MORE: Can you have a mortgage without homeowners insurance?

Key Takeaway The first and most important step of the home buying process is calculating your finances. Figure out your DTI, credit score, and down payment before taking any more steps.

Get preapproved for a mortgage

The next step is getting preapproved for a mortgage. Many sellers won’t show their property to you unless you can present your letter of preapproval, and once you go into negotiations you’ll have secure financial footing.

Here are the steps you’ll need to follow to get preapproved:

Provide your Social Security number to your mortgage lender

Submit a list of your assets, banking information, debts, and employment history

Submit a completed mortgage application

It’s a fairly simple process to follow, but do not start until you are absolutely sure you’re ready to buy a house! The information you provide to your mortgage lender will be used to confirm your ability to pay for the loan and your DTI, and the lender will perform a hard credit check.

If you apply for preapproval before your finances are in order, the check can harm your credit score and make it more difficult to gain future approval.

How to pick the right mortgage in Wyoming

The main considerations of picking out a mortgage are interest rate and mortgage term. The most common terms for mortgages are 15 years and 30 years.

Shorter mortgage terms have lower interest rates (about 2.5% on average), but you’ll have a higher monthly payment. On the other hand, a 30-year mortgage has lower monthly payments, but you’ll have a higher interest rate averaging around 3.5%.

Before you decide on a mortgage, compare different options from a few mortgage lenders.

Look for a house

Now it’s the time you’ve been waiting for: open up Zillow and start house hunting! You’re ready to begin your search for your dream house after you evaluate your finances and get preapproved for your mortgage.

Pick your city or neighborhood

When you’re deciding on a place to live, you’ll need to consider at least the following: climate, cost of living, and culture.

Cheyenne

, Laramie, and Star Valley Ranch are some of the most popular places to live in Wyoming.

Already know what area you want to settle down in? Research the housing market in the different neighborhoods and decide what is important to you in terms of your surroundings. Do you want to be at the heart of downtown Cheyenne? Or maybe a small town surrounded by nature? Don’t forget to take a look at crime rates and

car insurance

rates, too.

MORE:

Car seat laws in Wyoming

Buyer’s market vs. seller’s market

If you want to shop smart in real estate, learn how to spot whether you’re entering into a buyer’s market or a seller’s market.

Supply outweighs demand in a buyer’s market, and you may be able to negotiate your way to a lower purchase price.

If there are more buyers than available houses on the market, you’re looking at a seller’s market.

Want to know the quickest way to figure out which market your chosen area is in? Take a look at recent home sales, and then compare the final selling price to the asking price. It’s a seller’s market if the asking prices are lower than the prices paid by the buyers.

Another good indicator is time spent on the market: houses are quickly sold in a seller’s market but can remain available for weeks or months in a buyer’s market.

As of January 2022, Wyoming is in a seller’s market but it may not stay that way for too much longer. When you find the house you want, you’ll want to put in your offer quickly so you don’t miss out on the sale. Markets can change quickly, so make sure you research the area before making a commitment.

Find a real estate agent

You may feel like you have another job while you’re looking to buy a house—for real estate agents, that is their job! The state of Wyoming doesn’t require you to hire a real estate agent in order to buy a house, but one can be an extremely helpful resource.

If you decide to hire a real estate agent, you’ll want to look for someone with plenty of experience in the area you want to live in. Look for someone with good communication skills too!

Make an offer

When you find the house you’ve been dreaming of, you can submit your offer!

Your real estate agent can assist with all the paperwork and determine the best offer you should make based on the housing market. As long as you’ve done the prep work, you should be ready to make all of the payments and become a homeowner!

MORE: How neighborhood affects home insurance rates

How to save on homeowners insurance

Homeowners insurance probably isn’t the thing you’re most excited about when you think about buying a home. Maybe you haven’t really even thought about it yet, but you’ll need a homeowners policy to secure your mortgage and to protect your house.

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FAQs

How much money do I need to buy a house in Wyoming?

The exact dollar amount you need will depend on where you’re buying a house, the size of your down payment, and the type of mortgage you have. Since the average home in Wyoming costs $257,261, you should aim to have around $51,000 in savings.

What credit score is needed to buy a house in Wyoming?

To buy a house with a conventional mortgage, you need a credit score of at least 620. If you qualify for a VA or FHA loan, you can have a credit score as low as 500.

What is the best place to buy a house in Wyoming?

There is no single best place to buy a house in Wyoming. You’ll need to research different areas to determine which place has the best climate, cost of living, and culture for you.

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