Wednesday, February 9, 2022

How to buy your Future Home

Are you looking to acquire a home in the near future? Awesome, I hope to share some valuable information with you in this post. First thing first! Have a source of steady income. Homeownership is a wonderful deal but it can be costly. A home may need repairs shortly after acquiring it so its good to have that buffer to ease any unexpected expenses.

Find a lender that you trust. The lender will want you to have a source of income, they'll want to see tax returns to determine how much of a mortgage you can afford. Most lender want your debt to income to be around 43%. So if you make $5,000 and you wanted a home with a monthly mortgage of $2,000 there's a good chance you'll be able to move forward with aqcuiring that home pending your credit score. 

Popular Loan types: FHA and Conventional. FHA is a govenment insured loan that requires future homeowners to put 3.5% down to buy a home. FHA has morgage insurance attached to loan for the life of it, this can be an additional $200-$300 on top of the mortgage. A buyer can refinance out of this loan after a year. Conventional loans vary in down payment, they can be as low as 3%. With a conventional loan a buyer can remove their Mortgage insurance after 20 equity has established relative to the homes value. Once your ready to buy a home, it's good to have a understanding of where the market is in terms of a buyers and sellers market. Realtors often refer to month of inventory, which is a guage for supply and demand. A normal real estate market has about 3-6 months of inventory. 

Now that your ready to go shopping for a new home consult with a realtor to get you caught up with the current market and the landscape of the area your looking in. This is the time to get your expectations in line with theirs because the two of you will make the dream team.  

If your in a competitive market expect submitting more than one offer. Keep going until you find the right seller who appreciated your offer. In a competitive market for homes you can expect bidding above list price. If this sustains in your neighborhood you can expect to have an increase in home value when you do go to sale. 

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