3 Hacks for Buying a Home You Can Really Afford
Buying a home in the West Valley? For many, buying a home is the biggest financial investment of our lives — and the process is far from simple. Everything from locating the right REALTOR® to making an offer on a home can be an overwhelming task if you’re unprepared. Even if you’ve been through the home buying process before, you can still be taken back by updated home buying guidelines. So here are 3 hacks for buying a home you can really afford.
1.) Get pre-approved: It’s important to determine how much of a mortgage you can truly afford by getting pre-approved through a lender or mortgage broker. Getting a pre-qualification letter from a mortgage lender before you even start hunting for a home will help determine what you can afford. It’s best to aim for a home that costs less than the maximum amount for which you qualify and stick to that limit. A good rule of thumb is to make sure make sure the total monthly payment doesn't consume more than thirty percent of your take-home pay.
2.) Watch your credit: Your credit report and you should be on good terms before buying a home. Good credit can mean significantly lower monthly payments, so if your credit score needs some work, you may want to delay buying a home until you’ve rebuilt or repaired your credit. Address any discrepancies on your report and see if you can negotiate lower amounts to pay back with creditors.
3.) Make a down payment plan: Not every mortgage loan requires a down payment, but if you’d like the opportunity to have lower mortgage payments then it’s best to have one. Putting down anything lower than twenty percent means paying for private mortgage insurance (PMI) which can cost between 0.3 percent and 1.50 percent of your mortgage depending on the side of your down payment and your credit score.
When you’re ready to buy a home in the West Valley, Avondale, Goodyear, Litchfield Park or the greater Phoenix area, be sure to contact The Bourland Team, your one-stop shop for real estate services. Our award winning real estate team will meet and exceed your expectations!
The Bourland Team