If you’ve never bought a home before, the whole process can seem a little confusing. One of the first things you have to figure out is whether you should get a fixed-rate or adjustable-rate mortgage. Most people choose the fixed-rate mortgage without even thinking about it, but there are situations where an adjustable-rate mortgage may be a better fit.
Buying a house instead of renting is, depending where in the country you live, often more cost-effective. But upgrading from a smaller home to a larger home and mortgage? Probably not.
“There are solid reasons to upgrade your home. For many, it was always the plan. You buy a starter home, and upgrade to a larger one once your family expands. Or your income expands, and you finally move into your dream home. Regardless of your reason, the typical first step is determining what you can afford. A standard rule for lenders is that your monthly housing payment (principal, interest, taxes and insurance) should not take up more than 28% of your income before taxes. A quick and dirty way to check how much you can afford is through calculators like myFico calculator.
Ready to move on from renting? Here’s some tips on buying your first home.
Search for La Mesa homes for sale here!
1. Get your money in order
This might be the largest purchase you make, which makes sorting out your money a top priority!
2. Shop at more than one place for your mortgage
You don’t have to stick with the first place you go for a loan; check out other lenders.
3. Shop for your home
Part of shopping for a home means considering enlisting the help of a real estate agent; I would be honored to have the opportunity to earn the position. Give me a call to see how I can help you in your house search!
Student debts have seemed to affect homeownership rates, according to the Federal Reserve Bank of New York.
About 32% of those in their 20s owned a home in 2007, but that’s fallen drastically to 21% in 2016.
While the poor labor market and memories of the housing bubble certainly played a role, student debt can explain up to 35% of the decline, according to a report from the Federal Reserve Bank of New York released Thursday.
The results suggest that the rise in college costs will result in “weaker spending and wealth accumulation among young consumers in the years to come.”
It’s consistent with surveys that have asked those with student debt if it affected their decision to buy a home. Half of those under the age of 35 surveyed by the National Association of Realtors in 2016 said it had delayed their purchase. And 25% told Pew Research Center that student loans had made it harder to buy a home in 2011.
Your FICO score is the yardstick by which most lenders measure your credit worthiness.
The major credit bureaus keep track of loans that you have taken out in the past and how well you managed this debt. A high FICO score indicates that you have been responsible with the credit extended to you and will reflect positively on applications that you submit, while a lower score indicates that you have had credit issues in the past. Continue reading →