(1) attend a CHAPA approved First Time Home buyer class. I have been teaching these classes for non profits for 10 years and no one has ever said they are a waste of time.
(2) Go to one of your local Banks and ask to be pre approved for an MHP Soft Second loan, It is a very safe and sustainable loan for First Time Home buyers. Follow those two steps and you will have a good education and a safe loan to make your home buying choices easier and will help when assembling your team to take you through this process.
You can check out my website (AskForRed.com) for information on the MHP Soft Second loan and links to local non profits to find a class to attend.
A good mortgage broker can give you a lot of information about how much you can afford and how your current financial situation works for buying a home. I would definitely talk to one or more brokers. But I also would consider two other factors.
First, consider if you will stay in the home long enough for it to make sense to purchase now. This means that you must also consider what will happen when you sell. Selling a home costs a lot of money. At minimum you want to own your new home long enough so that you won't lose money when you sell. Thus, you should consider the costs of selling and compare these costs to any increase you might expect in the value of the home during your ownership, any money you will accrue as a result of mortgage tax benefits and how much equity will come from simply making payment on your mortgage. At the very least you want to make sure you will not have to bring money to closing when you sell. But, above and beyond that, you will want to walk away from closing with the money you put down on the home and hopefully some profit. Generally, owning doesn't do you much good unless you make at least something on your investment so you have additional money to apply to the next home you buy. And this usually means being in the house long enough that you can pay the costs of selling and still have more equity than your original down payment.
Second, is your credit score now high enough for you to get the best possible mortgage rate or is some repair in order. Building equity is much easier if you pay low interest on your mortgage. You can find out a lot more about credit scores at this blog post: http://www.trulia.com/blog/rovtar/filter/category/Credit_Score/56
I hope this helps.
Hi meghan. My name is jeannie carr and I also live in whitman and have been a realtor on the south shore for 26 yrs. I specialize in working with first time buyers. If you go to my website http://www.jeanniecarr.com and click on "get preapproved" it will give you the names of a few mortgage reps that I work with all the time. Just tell them I referred you and they will help you get all your financial ducks in a row. There are different programs for different levels of credit ratings but generally speaking you will need at least 3.5% down payment and your mortgage and current monthly debt cant be over 40% of your gross monthly income. You can also get buyer tips on my website and search for property and get daily email reminders if a home comes up in a town and price range of your choice. Let me know how I can help you.
I agree with the others, it is important you talk to a lender ...or two...and get pre-approved based on your credit score, income, and a few other variables. Keep in mind that you may be pre-approved for more than you are comfortable spending on a monthly basis, so come up with a budget that you know will work for you and your lifestyle.
Happy House Hunting!
Below is a link to a really useful article that has 4 tips to determine how much Mortgage you can afford:
The best thing to do is contact a mortgage lender. They well be able to tell you what price range of home you can look for. I always advise my clients to try and stay a little under that amount in order to purchase a few new items for the home. It is very easy to get Pre-Qualified for a mortgage. It can be done over the phone, things to have on hand are your most recent pay stubs, and your tax return, and the current bills you pay monthly. To find a lender is personal choice. Family, friends, co-workers or Realtor can suggest who to call.
A word of advise is get Pre-Qualified first before viewing any homes.
Good luck in your search for a new home Meghan!
Ellen G. Friedman, Keller Williams Realty, firstname.lastname@example.org
I hope you are well. It is important to first get a pre-approval letter from a reputable mortgage company. This will give you an idea of maximum price point and also comes to you at no out-of-pocket cost. From there, you will need to consider your personal preferences.