Establish A Housing Budget That Fits Your Current and Future Goals
A vital part of your
overall long-term success when it comes to homeownership is determining a
housing budget BEFORE you contact a mortgage professional. There can be
additional costs involved with owning a home besides the mortgage. Many
times, you can take on additional utilities, maintenance and other
costs that are not necessarily considered when you apply for a mortgage.
You also need to consider your short and long term goals that may
impact your current financial situation. Do you want to have children?
Start a business? Save for your dream vacation? Just because you are
buying a home does not mean that everything else in your life takes a
back seat! Think about the most you want to spend monthly for housing
while considering those other life goals. When you visit your mortgage
professional, let them know what that monthly amount is and make sure
your lender knows that monthly amount must INCLUDE all escrows: taxes,
insurance, mortgage insurance, even HOA dues. They can generally give
you an idea of what that will equate to in purchase price and down
payment.Â That's right, you "back" into a purchase price!!
Do Your Homework When Looking For A Mortgage
A very important part of buying a home is
finding the right lender and the right mortgage product. There are many
different kinds of lending institution, offering a wide range of loan
packages. So it is important to do some research and shop around because
what you don't know could cost you.
In this regard, over the course of my career I have
some excellent contacts in the mortgage industry, so if you have any
questions or if you would like me to refer one or more of them to you,
please let me know.
It is recommend that home buyers get
pre-qualified for a loan with a lender before searching for a home to
purchase. That way you will have completely reliable information about
what you can afford. Additionally, most listing agents will not accept
offers without a recent preapproval from mortgage professional.
Other good reasons to get pre-qualified include:You can determine which loan program best fits your need and which programs you qualify for
You'll know exactly how much you are qualified for. It's no fun
to find your ideal home and then realize that you can't afford it.
Knowing estimates on closing costs and prepaids for your loan
gives your buyer agent a better idea of how to handle negotiations with
If you are a first-time buyer, you may qualify for a special
first-time buyer program which may allow you to afford more home for
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