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Don't build yourself a mortgage mountain. It's fine to want the best home you can afford, but be certain that it is
comfortable affordability. Although you may find certain mortgage lenders who will stretch your qualification rations
(the ratio of your total mortgage payment to your total income) the traditional, the mortgage payment as 28% of your
income and the total of your mortgage payment plus your monthly debt payments as 36% of your gross income, are
good basic guidelines.
Get your budget under control. Spending some time reviewing your budget (or developing one if you don't already
have it) and sharpening your money saving skills can bring big rewards later. A coordinated budget allows you to get
the most home for your money without strapping yourself while eliminating wasteful spending.
Prepare to pay off small debts. Having 3 credit card balances, for example, one with a $125.00 balance, a second
with a $165.00 balance and a third with a $275.00 balance will only cloud the picture. Even though the total is only
$565.00, all 3 will have minimum payments, credit lines, etc. If possible, prepare to pay them down to $0.00 balance.
Begin to gather documentation. It is not necessary that you have all items in hand before you apply, but there are
a number of documents you will need eventually and the approval process will go much smoother if you being to
gather them now. Examples: W-2's and income tax returns from the last few years (especially if you are
self-employed), copies of pay stubs, records of any child support or alimony (either going out or coming in) and bank
statements for all accounts (checking and savings) for the last three months.)
Don't forget about closing costs. In addition to your down payment, you will need to reserve funds for closing
costs. Depending on the type of loan and your location, these costs can range from 2-6% of the mortgage amount,
and will need to be paid for in cash at the closing and cannot be borrowed funds.
Consider points when comparing. Your total mortgage cost will be determined by 3 factors: The interest rate, the
term and the amount of points.
Consider a 15 or 20 year term. Many home buyers make the assumption that a shorter term will boost their
payments out of reach. Unless you make the comparison though, you may never know if a 15 or 20 year (if available)
term could have been affordable. See a comparison of a sample loan (see our Loan Payment Calculator). If you are
concerned about committing to the higher payment of shorter term, try this tactic: Mortgage the home with a 30 year
loan but pay the mortgage at the shorter term payment. It will do wonders for your equity position!
comfortable affordability. Although you may find certain mortgage lenders who will stretch your qualification rations
(the ratio of your total mortgage payment to your total income) the traditional, the mortgage payment as 28% of your
income and the total of your mortgage payment plus your monthly debt payments as 36% of your gross income, are
good basic guidelines.
Get your budget under control. Spending some time reviewing your budget (or developing one if you don't already
have it) and sharpening your money saving skills can bring big rewards later. A coordinated budget allows you to get
the most home for your money without strapping yourself while eliminating wasteful spending.
Prepare to pay off small debts. Having 3 credit card balances, for example, one with a $125.00 balance, a second
with a $165.00 balance and a third with a $275.00 balance will only cloud the picture. Even though the total is only
$565.00, all 3 will have minimum payments, credit lines, etc. If possible, prepare to pay them down to $0.00 balance.
Begin to gather documentation. It is not necessary that you have all items in hand before you apply, but there are
a number of documents you will need eventually and the approval process will go much smoother if you being to
gather them now. Examples: W-2's and income tax returns from the last few years (especially if you are
self-employed), copies of pay stubs, records of any child support or alimony (either going out or coming in) and bank
statements for all accounts (checking and savings) for the last three months.)
Don't forget about closing costs. In addition to your down payment, you will need to reserve funds for closing
costs. Depending on the type of loan and your location, these costs can range from 2-6% of the mortgage amount,
and will need to be paid for in cash at the closing and cannot be borrowed funds.
Consider points when comparing. Your total mortgage cost will be determined by 3 factors: The interest rate, the
term and the amount of points.
Consider a 15 or 20 year term. Many home buyers make the assumption that a shorter term will boost their
payments out of reach. Unless you make the comparison though, you may never know if a 15 or 20 year (if available)
term could have been affordable. See a comparison of a sample loan (see our Loan Payment Calculator). If you are
concerned about committing to the higher payment of shorter term, try this tactic: Mortgage the home with a 30 year
loan but pay the mortgage at the shorter term payment. It will do wonders for your equity position!
| CONTACT US NOW Phone: (239) 354-0058 Fax: (888) 607-4420 info@elitemortgageservicesinc. com |
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