Skip to main content

Buying a home: Step 1 – Understand your means


Buying a home can be very scary, especially if it’s your first time. That can be true for anything new you try! As with anything new, it’s important that you understand the process and plan ahead. The first step in the process of buying a home (whether it’s your first home or your tenth!) is to understand your means.

It’s very important to talk to a mortgage broker to understand a) IF you qualify to buy a home and b) what amount of money you qualify to borrow. However, just because you qualify for a certain amount, doesn’t mean you can actually afford the monthly payments! It all depends on your lifestyle. Do you like to travel? Do you go out to eat a lot? Are you a fashion fanatic? All of these things and more will impact how much you can afford when buying a home, unless you want to change your lifestyle completely. And who wants that? No one wants to be house-poor… right?

When talking to your lender, make sure to ask questions so that you understand what the payments will be at different price points. You may qualify for a $500,000 mortgage, but how much do you have to put down? What will the payments be? How much will the payment be on a $400,000 house? You get the point. Then go home and run the numbers. You have to decide if there’s any part of your current lifestyle that you’re willing to sacrifice to buy a home. Or maybe you won’t have to sacrifice anything, but you will need to prioritize so that you can understand what sort of monthly payment will be comfortable for you, without having to resort to eating ramen noodles for dinner every night.

Not all Mortgage brokers are the same. Make sure you speak with more than one and understand that the size of the bank or banks they represent might impact the size of the loan you qualify for and the rate you’re quoted. Bigger is NOT always better when it comes to banks. If you need help finding a good lender – feel free to reach out to me.

Sit down with your family and put a budget together. Decide how much you’re willing to pay per month, what that translates into for a 30 year mortgage, and stick with it!

PS – There’s a reason why Step 1 is ‘Understand your means’ and not ‘Choose a location’. Stay tuned.


Comments

Post a Comment

Popular posts from this blog

Back in Action!

Some of you may be wondering why I took a little hiatus from real estate. Well.... here's your answer! Isn't he a cutie?! This is my son, Everett James Crossett. He's just over 3 months old, and is the absolute light of my life! I wanted to take some time to devote solely to him, so I took a few months off, but now I'm back in action! I'm so fortunate that my mom is retired, lives nearby, and is always happy to watch my little peanut when I am out with clients!  I've been meeting with my first few clients since his birth over the past few weeks, and I'm happy to say that I got my first ratified contract last night! It feels good to get back to work, especially now that I have a little one to provide for. I have always loved my job, but now I do more than ever, since it allows me to be there for my son AND provide for my family financially as well. He motivates me to be both the best mother and the best real estate agent I can! If you or someone ...
Post a Comment
Read more
Go With Your Gut Buying a house is just like any other important decision you'll make in your life. Yes, it's important to do the research, and it's important to explore your options, but at the end of the day, the most important thing is to go with your gut. When you find the right house for you, you'll know it. Don't hesitate. Think about it this way: when you found the right man or woman for you, did you say, "I think you're the right one, but I'd like to go date 10 more guys just to make sure"? Do you think he'd wait around if you did? I think not.  The past few days that I've spent with my current clients have reminded me a lot of my own home-buying experience. Just as I had, they spent months looking at properties online in all different areas, planning where they would buy, when they buy, and what they would buy. They had their must-have lists, their budgets, and their timeline. And then... an opportunity presented itself. T...
Post a Comment
Read more

Navigating a Seller's Market

Navigating a Seller's Market With inventory near record lows and interest rates at their highest point in years, you may be thinking now is an impossible time to buy a home. However, while it can certainly be a challenge, it is nowhere near impossible! Even though all signs point to the Fed lowering interest rates this year, we're still likely to remain in a seller's market for the time being. With that in mind, I thought now, heading into the normally busy Spring market, would be a good time to offer some home buying tips for this current environment. So, let's start with the basics: What is a seller's market? In it's most basic sense, the definition of a seller's market comes down to economics 101: Supply and Demand. Right now, there are more people looking to buy a home than there are homes on the market or people interested in selling their homes. For reference, according to market experts, in a balanced real estate market (where there are an equal numbe...
Post a Comment
Read more