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How a calculator can help you buy a home.

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Top Ten Rules to Follow When Buying a Home Part 4

4. Determine how large your mortgage can be. Explore different loan options to determine
what is best for you.

This is a good exercise for anyone looking to buy, or even hoping to buy in the future. Find a mortgage calculator online and determine in reverse how large of a mortgage you can afford.

Business man accountant calculating invoices in office

Business man accountant calculating invoices in office

On my website there are some really cool online calculators. Click on the menu button that says Mortgage Information. There are 23 different loan calculators there. But for buyers, the important one is probably the Affordability Calculator. It will ask for how much down payment you have, what your income is, and what your debt is. Don’t worry about it sending information to me…I don’t see it. It will then let you know about what the payment the bank thinks you can afford is, and what loan amount and purchase price that would qualify you for.

Give it a try….at www.AgentInAKilt.com

Other great calculators are available there….such as how much time you could cut off of your mortgage by paying more each month, what your tax savings is buy owning a home, a rent vs. buying cost calculator…and more.

If you would like me to do it for you, give me a call.

Ten Rules to Follow When Buying A Home

1. Make a commitment. Commit yourself to your new home for at least a couple of years
before making your next move.
2. Money matters. If you’re considering a mortgage, shore up your credit and get a copy of
your credit report.
3. Get pre-approved. Save yourself the time and grief of looking at houses you can’t afford.
4. Determine how large your mortgage can be. Explore different loan options to determine
what is best for you.
5. Decide what (and where) you want to buy. Prioritize your needs (i.e., location, schools,
amenities).
6. Consider your re-sale value. Even if you don’t have school-aged kids, a strong school
district is a good thing.
7. Do your homework. Bid based on sales trends of similar homes in the neighborhood.
8. Calculate the hidden costs. Property taxes, insurance, maintenance and association
fees can impact your wallet over time.
9. Don’t be house poor. Double and triple check to be sure you haven’t maxed yourself out
on the cost of your home and left nothing for maintenance, etc.
10. Get help. Hire a REALTOR® to get the most for your money. It pays to have
someone looking out for your interests. (note: when it says Hire a Realtor, make sure you sign a buyers service contract with the Realtor that spells out the Realtor’s responsibilities to you.)

Banks are working hard at workouts

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It seems that as the economic situation in this country is still a bit on the scary side, more and more people, media, companies and politicians recognize that the housing market is the key to a stable economy.

Houses are an investment that people can really relate to them. You can touch a house, you can clean a house, you can demolish a house. Unless you are Bear Stearn, it isn’t quite so easy to demolish a stock.

So Fannie and Freddy are getting presure put on them, and in turn are pressuring companies such as Wells Fargo to make deal with homeowners to keep them in their homes. The latest article I read today was that they were looking at doing loan workouts that dropped the monthly payments of properties to 38% of the property owners income. That is historically where the banks wanted payments to be in order to loan money.

How this is really going to work is anyones guess. What happens if the homeowner is one of the thousands of people who have lost their jobs? 38% of nothing is ?????? nothing?

The good news is that the banks/politicicans recognize the problem. They are listening to the Realtor association about what us professionals have found to be the kinks in how they are trying to solve problems.

If you are a homeowner at this point who is having problems paying your mortgage…hang in there. There look to be some workout options around the corner.