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While owning your own home is often considered a key component of the so-called, American Dream, wouldn’t it make sense to plan, effectively, to ensure it doesn’t become a nightmare? ? After fifteen years as a Real Estate Licensed Salesperson in the State of New York, I have created what I, oftentimes, refer to as RICH IDEAS, for moving forward wisely when it comes to buying a home. Keeping this in mind, this article will attempt to briefly consider, examine, review and discuss how to prepare for this process appropriately, effectively, intelligently and proceed accordingly.
1. Accumulating/depositing sufficient money together for a variety of needs and requirements: It’s smart to get ahead, as well — as prepared as possible, right from the start. Well – before you start house hunting, start saving money in a systematic way. Remember, you’ll need money not only for the down-payment (often, but not always, 20%), but also for other closing costs, including prepaid real estate taxes, utilities , but not limited to. , and other, so-called, escrow items. In addition, most lending institutions require a demonstration and proof of funds, equivalent to several months of mortgage payments.
2. Get a copy of your credit report (get both if husband and wife): You are entitled to request a free copy of your credit report from one of the major credit organizations/companies once per year. Review this document carefully and correct any errors. If your rating is not as high as a lending institution would like, start taking steps to raise and improve it, sooner rather than later!
3. Payment – Other loans below: Lending institutions use formulas to determine someone’s eligibility to receive money. These usually focus on the percentage of debt to income. So, pay off your other loans before starting the process!
4. Do not add any more debt: At this point, however convenient and/or tempting it may seem, avoid taking out any further loans. Don’t fall into the trap of accepting new store charge accounts, as doing so can compromise your credit when you seek a mortgage!
5. Shop for homes within your means: Avoid the trap of becoming house-rich, and try to buy a home beyond your comfortable means! Know how much you can afford, comfortably and safely, so choose wisely, and live comfortably!
Since, for most of us, the value of our home is our greatest asset, doesn’t it make sense to proceed, carefully and wisely? Will you be up for this task?
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