If this is your first home purchase then you will probably feel very overwhelmed.
Everyone you meet will a different idea of what you have to do in order to "get ready" to buy a house. Most of what you will hear will be conflicting, out-of-date information, or worst yet just plain bad advice.
The very first thing you must do is figure out where you stand financially. Deciding you want to buy a house and actually being able to do so are two entirely different things. Hopefully, you’ve already been thinking about your financial history - just a little bit I hope.
If not, you can be certain that during any home buying process every bank loan officer or mortgage lender you encounter certainly will. That's where these four questions below can help you.
They are what the U.S. Department of Housing and Urban Development (HUD) suggests you ask yourself when you are considering buying a house.
The Four “Get Ready” Questions
“How steady and reliable is my current income? Have I been employed consistently for the last few years?” - Having multiple jobs or being self employed are usually not red flags with most lenders, but they will likely want to see at least a year or two of a consistent income. But having a stable job or career is always viewed more favorably.
“How much debt do I have?” - Add up your installment debt. Include things like car payments, student loans, and ALL your credit cards. Be sure to include any loans you are a co-signor for as many people forget this. If your debt-to-income ratio is higher than 36%, then you probably will have difficulty qualifying for a good loan.
“How well do I pay my bills when they are due? Do I receive a lot of late notices?” - How you pay bills now may predict how you will handle your future mortgage payments. Mortgage lenders will definitely be interested whether you can comfortably manage your current payments.
“Do I have any money saved up? If so, how much?” - This can be regular savings, 401k retirement accounts, and money market accounts. Basically anywhere that you might have cash assets set aside that you can use for a down payment. Typically you need anywhere from 5 to 20 percent down to qualify for a conventional home loan.
So Are We Ready?
Well, mortgage lenders will decide whether or not you are a “good risk” for a home loan partially based on the questions you just answered above along with your credit score and history.
But as to whether or not you are really ready to start the process of buying a home?
That’s a question only you and your family can answer. But a qualified real estate agent can help you evaluate your financial health and recommend a good mortgage lending service.
If you have any questions about the home buying process or mortgage lending, we invite you to contact our home buying specialist, Rachel Alosky at 828.210.1684 or by email TeamStreppa@gmail.com.
Author:Skye Streppa Phone: 828-713-5690 Dated: January 28th 2016 Views: 527 About Skye: Skye Streppa is an Asheville native who holds a wealth of local knowledge and a depth of character f...
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About The Streppa Team | RealtyAsheville.com: Homes for Sale
As a native of Asheville, NC, Skye has an unparalleled understanding of the local market and area. Honesty, integrity and a hardworking spirit are the very tenets that ensure Skye gets you the very best deal in every real estate transaction. That very business model has led to Skye Streppa being a multi-million dollar producer for Keller Williams for nearly 10 years running.
Starview Heights is a private gated community in the heart of Western
"April 12, 2016 Dear Mr. Stevenson: It gives me great pleasure to write this letter of commendation and thanks on behalf of Rachel Alosky. My husband and I recently purchased our new home in Candler and Rachel was our agent. I can't say enough positive things about her and the way she gently guided us through this arduous process. We were nervous and apprehensive about the process because we live so far away and don't know a lot about the area. But from the very beginning it was clear to us that we had, by divine providence we believe, come to be in the care of the most excellent person to help us reach our desired goal. Certainly you must already know what a gem Rachel is. She demonstrated herself to be a highly skilled professional who displayed so many of the qualities that we hold dear, such as incredible knowledge, patience, honesty, reliability, responsiveness, integrity, and courtesy to name a few. She is mild-mannered and even tempered and always followed up and followed through on every single detail that we discussed. She generously shared with us information that helped us to make the right decision for us. She was always available and willing to go the extra mile for us and with us. We came to trust her completely, something that we New Yorkers are not quickly prone to do. We learned that she would always look out for our best interests. Rachel never disappointed us. In fact, she continued to amaze us with her awesomeness throughout the process. Frankly, I will miss dealing with her on a regular basis. She's a most remarkable young woman! I could go on and on about the many benefits to us of having had Rachel represent us, but I think you get the point. Please know that we would never hesitate to recommend Rachel and your firm to others when the opportunity presents itself because of our experience with Rachel. Thank you. Sincerely, Rose Walker-Yates"