Before You Look at Your First House

As a first-time homebuyer - you'll want to take a hard, objective look at your finances. Determining how much money you can dedicate to the purchase of your new house affects almost every aspect of buying a new home - including how we write the offer, which mortgage programs you will qualify for, shopping for the best mortgage loan and which homes are truly in your price range.  A good mortgage broker can help you decide on the best loan type for you --- and they can also get you pre-qualfied at no obligation.  Feel free to give this lender a call for more information on getting pre-qualified. 

Here are the questions that each home buyer should ask: How much cash is available for a down payment? The amount you have available for a down payment will affect what types of loans for which you can qualify. Learn more. Am I ready to write a check for the earnest money? Earnest money is a cash deposit made to a home seller to secure an offer to buy the property. This amount would be forfeited if you default on the contract.  You can receive your earnest money back if you don't like the results of a home inspection or the credits or fixes that the seller offers -- or if you don't like some other issue, while you are in the attorney approval phase of your deal.  How much additional cash will be necessary to pay for closing costs? There are certain standard costs associated with closing the sale of a house. We can give you a good ballpark estimate of these costs.  Typically - we have the seller pay for your closing costs. Learn more. What is the maximum monthly mortgage payment that I can afford? Most lenders will use the 28/36 rule to determine the maximum mortgage payment you can afford.

The 28/36 Rule
No more than 28% of your gross income can be applied to your mortgage, real estate taxes and insurance. And no more than 36% of your gross income can be applied to your mortgage expenses plus your regular debt expenses (car payments, credit cards, other loans, etc.).