Buying season is coming up! If you’re looking to buy soon, here are three tips to help you get ready!
1- Your credit score– the interest rate you will get on your home loan will changed based on your credit score and will affect your monthly payment. The best credit scores (740 and above) get you the best interest rate on your mortgage. Now, often times, there will be TWO people on the home loan and lenders will go with the lowest credit score of the two to make this determination. Spend this time getting your credit score as high as possible!
2- Closing costs– IF you are purchasing a home that is under the current average purchase price (about 330,000 right now), there is a good chance that you can get some of those closing cost fees covered by the person selling the home. There are a lot of fees associated with purchasing a home, such as lender fees of about two percent and title fees at about one percent. There are no-money down loans, but they often have the HIGHEST closing costs of any loans. Talk to your lender far in advance and find out what loan you will qualify for, so you have an idea of what closing costs will be associated with that loan type.
2- Purchase price– Start thinking about how much you want to spend. Don’t spend more than 30-40% of your TAKE HOME pay on your monthly mortgage. Lenders, on the other hand, will qualify people for loans that require payments of up to 55%! Don’t go that high- or you will be house poor! It’s painful!
If you have more questions or want more specific answers, reach out to me here!