FAQs for First Time Buyers
As big an investment as buying a house is, there are many questions to ask. Here are some of the most frequent.
How Do I Figure Out How Much House I Can Afford?
This really is the key question, and it will affect your life every single day after you close on your home, especially if you miscalculated. Your mortgage broker can help you with some of these calculations, but you also need to do your homework and prepare your personal budget. Keep ALL costs in mind when looking at your house budget: maintenance on a home, property taxes and insurance, and all of your other bills. If you’re stretching yourself too thin, you’re likely headed for disaster. As a general rule, a mortgage should not take up more than 25 to 30% of your net income.
How Much Do I Need for a Down Payment?
Saving for the down payment is the greatest obstacle for first-time homebuyers. Lenders expect between 5% to 20% for a down payment. It varies according to the lender’s requirements, and the type and length of the loan. Make a budget, set a goal, and stick with the plan. Saving and sacrificing is how most people come up with their first down payment.
How Do I Know If I’m Ready to Own a Home?
While there is no single sign that will confirm a person is ready for home ownership, there are a couple cues that will signal it could be your time. If you love the area that you’re living in and you’re planning to stay for a while, you may be ready to settle down and buy a home. If you’ve got a savings plan in order that is allowing you to pay down debt and save a little nest egg, you could be ready for the financial side of home ownership.
How Do I Find the Right Lender?
When it comes to financing a home, it is a good idea to shop around for the best mortgage terms. Many buyers often start with their own personal banking institutions or credit unions. The federal government offers competitive loan programs for first-time homebuyers as well. Buyers are able to seek out mortgage rates from several lenders before selecting the one that is best for them.
Make sure you contact me to continue this great real estate conversation. Call me at: 812-323-7300 or for more details visit: www.traceelutes.com.