How to Make Your Dream of Homeownership a Reality
Once you have a real estate professional securely in your corner, you’ll want to understand a little bit more about the homebuying process. Here’s a look at three important questions to think through. 1. How Can I Better Understand the Process, and How Much Can I Afford? The process of buying a home is not one to enter lightly. You need to decide on key things like how long you plan on living in an area, school districts you prefer, what kind of commute works for you, and how much you can afford to spend. According to ConsumerReports.org : “Financial planners recommend limiting the amount you spend on housing to 25 percent of your monthly budget.” Keep in mind, before you start the process of purchasing a home, you’ll also need to apply for a mortgage. Lenders will evaluate several factors connected to your financial track record, one of which is your credit history. They’ll want to see how well you’ve been able to minimize past debts, so make sure you’ve been paying your student loans, credit cards, and car loans on time. 2. How Much Do I Need for a Down Payment? In addition to knowing how much you can afford on a monthly mortgage payment, understanding what you’ll need for a down payment is another critical step. Thankfully, there are many different options and resources available to potentially reduce the amount you may think you need to put down on a home. If you’re concerned about saving for a down payment, start small and be consistent. A little bit each month goes a long way. Jumpstart your savings by automatically adding a portion of your monthly paycheck into a separate savings account or house fund.
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