Are you armed with the knowledge to buy a home? Here is list of things to consider before buying your first home.
Strengthen You Credit Score!
The higher your credit score, the lower your down payment and your monthly payments.
Below 660 or 680, you're either going to have to pay sizable fees or a higher down payment.
A score of 700 to 720 will get you a good deal and better rates on the market.
Pull your credit reports and be sure you're not unfairly penalized for old, paid or settled debts.
Stop applying for new credit a year before you apply for financing.
Figure Out How Much House You Can Afford!
For conventional loans, a safe formula is that home expenses should not exceed 28% of your gross monthly income.
If you're using FHA financing, as almost one-fifth of buyers get FHA-insured loans, your home payment can't exceed 31% of your monthly income.
Before you home shop, calculate the mortgage payment for the home in your intended price range, along with the increased expenses (such as taxes, insurance and utilities). Then bank the difference between that and what you're paying now.
Save For Down Payment and Closing Costs!
Depending on your credit and financing, you'll typically need to save enough money to put anywhere from 3.5% to 20% down.
If you're using FHA financing, then you need a score of 500 or higher. And in the 500 to 579 range, if you can find a lender, you'll have to put 10% down instead of 3.5%.
Another cash expense: closing costs. Whatever your loan source, you'll also need money to pay closing costs, which run (depending on where you live), from $2,300 to $4,000.
Build A Healthy Savings Account!
Your lender wants to see that you're not living paycheck to paycheck. If you have three to five months' worth of mortgage payments set aside, that makes you a much better loan candidate.
Improve your chances by: setting aside money every month. A good rule of thumb: on average you'll spend 2.5% to 3% of your home's value annually on upkeep, repairs and maintenance.
Get Preapproved For a Mortgage!
Before the real home shopping begins, you want to get financing in place.
Improve your chances by: getting financing in place "before you walk through the first house.
Most Importantly – Buy A House You Like!
Buy a home that will make you happy for years to come.
Making certain "you like the house."
A1 Mountain Realty has years of experience selling North Carolina Mountain Real Estate. We understand the beauty and allure this area holds and our trained professionals can assist in property evaluations and provide timely feedback on our progress. We have built a strong reputation from the ground up and above all else, we want you to feel comfortable in your choice with A1 Mountain Realty. Learn more about our West Jefferson NC Real Estate from our website (www.a1mountainrealty.com) and take a look at the Downtown West Jefferson Webcam from the home page, view the downtown area and a ominous view of Mt. Jefferson. We invite you to stop in our office any time, or give us a call today at 336-846-4900.