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Helpful Tips for First-time Homebuyers

posted by Stephen Katz @ 11:40 AM
Friday, March 9, 2012

Buying a home for the first time can be the most imperative financial decision someone can make; that being said, it is crucial to be aware of all the key aspects that make up the responsible purchasing decision.

The first step to being a first time homebuyer is determining whether the expenses demanded with homeownership are plausible for your circumstances. Some of these include your down payment, monthly mortgage costs, property taxes, and utility costs.

After all expenses are accounted for, the next step is to make a responsible decision of what you can afford. There are two rules of thumb when approximating how much you can afford:

First rule: housing expenses (including mortgage, utilities, insurance, and taxes) should make up no more than 1/3 of your income.

Second rule: overall debt (including loans, credit cards, etc.) should not exceed more than 40% of your income.

If the two criteria are safely attainable, then homeownership is a practical decision.

Tips for first-time buyers:

The larger your down payment, the smaller amount of interest you will have to pay.

To lower the overall cost, simply shorten the length of the mortgage; this will save you money on interest costs and ridding you of debt sooner.

A pre-approval ascertains the amount you can realistically afford to pay for your home.  Getting pre-approved allows you protection from rate changes and having the ability to make an offer when you find your ideal home.

Stephen Katz

(770) 309-0939 (direct) or (866) 742-8400 -- For the past 18 years, Stephen Katz has built a successful business almost entirely on referrals. As your mortgage consultant throughout the home loan process, Stephen will explain the pros and cons of all available mortgage programs and help you choose the financing option that is best suited to your needs. Throughout the loan process, he will keep you informed and will respond quickly to your requests with answers and solutions. Consistently a top producer, Stephen is a Mortgage Bankers Association "Diamond" Award winner, a Georgia Mortgage "Top Gun" and has closed almost half a billion dollars in loans. Put his knowledge and experience to work for you!

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