How much house can you afford?

To arrive at an affordable home price, realtors followed the guidelines of most lenders. In general, that means your total debt payments should be no more than 36% of your gross income.

For example: When you calculate your monthly debt (including credit cards, student loan and car payments), lenders come up with a maximum monthly home payment you could handle while staying under that threshold.

 “That home payment assumes a 30-year mortgage at current rates, and includes 1% property tax and 0.4% for homeowners insurance.”

“It does not factor in private mortgage insurance, which you'll owe if your down payment is less than 20% of the purchase price.”

“You should reduce the maximum target if you have other savings needs (such as retirement and college) or additional expenses (such as child care, private school tuition, health care, or alimony payments)”

 

The Do’s and Don’ts on finding a ratable credit repair service

 When looking around for a great credit repair work service, there are things you must do and things you absolutely must REFRAIN.

DO look around– have several choices.

DO ask concerns about fees– legitimate credit repair services shouldn’t take all your money up front.

DO discover exactly what type of guarantees they make.

DO attempt and get as much in composing as possible to safeguard yourself.

DO your research! Always check the Better Business Bureau to make sure that company is reputable. Goggle is a good tool to use to read up on different reviews on companies.

DO N’T believe claims that the service can remove any bad credit, can raise your credit score in a short period, and so on

 DO N’T pay a large amount up front– lots of scams will certainly take your money and run.

DO N’T sign up for any credit repair services that are unwilling to give you something in composing.

DO N’T make use of the service without completely investigating its qualifications.

By law, credit repair services should give you a copy of “Consumer Credit File Rights Under State and Federal Law” prior to signing an agreement with them. A credit repair work service cannot make false claims about their services or charge you in full till they have provided services.

 

"10 Steps You Must Take Before Owning A Home"

Realtor. Com is an informative tool for rents, soon to be home owners as well as realtors.


Becoming and inspiring home owner is exciting but you have to make sure that you cross all T's and dot all I's. When someone is looking to take that important set in their life you have to ask yourself, am I ready? Is my credit together? Do I have enough saved? LOCATION! Is my current source of income stable?


Here are some crucial steps you need take before becoming a home owner:


1. Check your credit
"Go to annualcreditreport.com and request free credit reports from all three credit reporting bureaus: TransUnion, Equifax and Experian. For a small fee, you can also get your credit score.
First up, check the reports thoroughly for any errors that need correcting and any negative information. These reports should also indicate what you can do to improve your credit. A higher credit score makes it easier to qualify for the lowest interest rates, which in turn make your purchase more affordable."




2. Start saving
"One trick is to save the difference between your rent and what you estimate your mortgage payment will be—or more. You’ll need cash reserves to buy a home, and you’ll need to prove to a lender that you can afford housing payments that may be higher than what you’re currently paying in rent."




3. Earn extra cash
"If you’re low on cash, as most first-time buyers are, consider taking drastic steps to cut spending. Or try out some ways to increase your income, such as selling some of your stuff or taking a part-time job." It never hurts to have a second source of income to ensure that you are able to consistently make your mortgage payments.




4. Start looking at neighborhoods
LOCATION! LOCATION! LOCATION! "Unless you already know where you want to live, take the time to visit a variety of potential neighborhoods. You’ll want to scout out ‘hoods that meet your needs in terms of transportation options and other amenities. Exploring different locations will help you narrow your priorities."




5. Consult a lender
"The sooner you visit a lender, the quicker you’ll know what you can afford and the steps you need to take to improve your credit or generate more income." Most banks PNC in particular will provide you with a pre-approval letter. This letter as previously stated will give your broker a good idea of how much you and your spouse can afford to purchase a home.


 6. Investigate down payment assistance programs
"Visit Down Payment Resource to learn about programs in your area that may help you find down payment money or a low-interest loan." Be sure to consult with your realtor on different first time home buyer programs.


 7. Attend a seminar or take classes on buying a home
"Lenders and agents often offer free seminars that explain the home-buying process.
Many local government and nonprofit agencies also offer classes that can help you prepare for the financial responsibility of owning a home."


8. Decide how much you want to spend
"A lender can give you an idea of how much you can borrow, but you have to create a personal budget to decide how much you will be comfortable spending on your mortgage payment." Lenders follow the debt to income ratio rule. Your monthly mortgage payment, including principal, interest, real estate taxes and homeowners insurance, should not exceed 28 percent of your gross monthly income. To calculate your housing expense ratio, multiply your annual salary by 0.28, then divide by 12 (months).


 9. Visit open houses
"Try to avoid walking through homes you simply can’t afford—you don’t want to fall in love with something and then be dissatisfied with all other options. Going to open houses early in your search will let you see what’s available in your area that might fit your budget. You can then begin to see what matters most in your decision: the location, room to entertain or outdoor space."


10. Interview REALTORS® Specifically Owens-Wheaten Realty Co.
"At each open house you’ll meet a REALTOR® who represents the seller of the home. As long as you don’t plan to make an offer on that particular home, there’s nothing wrong with striking up a conversation with the REALTOR® regarding your plans for buying a home. It’s a good idea to talk with and interview multiple REALTORS® to find one you can trust to have your best interests in mind." Always do your research on your potential Realtor. It is very important that you read reviews on the company as well as the individual. Buying a home is a wonderful, exciting, complicated, tedious, potentially long, and rewarding experience. Make sure that you have someone in your corner that you can trust and that has your best interest at heart.






Owens-Wheaten Realty Co.
CEO/Managing Broker: Mae P. Wheaten
President/Broker: Keisha J. Wheaten
wheatenkeisha@gmail.com