So… now that we are
looking for a house we need to figure out what we can afford and more
importantly what we should afford.
This is the "not so fun" math portion of buying a house!! AHHHH (I haven't done this much math since college freshman year!)
Now let me preface this
entry by saying I am not a mortgage expert. These are just my thoughts from my
experiences so far as we are trying to figure out how to buy our first home.
This is the process we are following:
This is the process we are following:
Ideally the mortgage and
pre-approval should be determined before you even look at a house; as this will
help you decide what price range you should be considering. We are working with a mortgage
consultant that was recommended from one of my friends and fellow Realtor.
What we have decided we
can afford is actually much less than what we were approved. We came to this conclusion once we
looked at all of our monthly expenses- and keeping in mind that we may
want to have children soon (and it's my understanding those can get expensive)- so we do not
want to stretch ourselves too thin!
It’s important to figure
out what you are comfortable spending per month on a mortgage payment. The
monthly payment is the number you need to pay the most attention to- not just
the approval number. Once you have
a property in mind you can send this property information (address, price) to
your mortgage consultant and they can give you a very good estimate of what your
monthly payment will be.
When your mortgage
consultant gives you an estimated monthly cost find out if this
cost includes taxes, insurance and PMI (Primary Mortgage Insurance).
We have reviewed our
budget and figured out what we are comfortable spending taking into account our
other payments such as cars, insurance, phones, electric, Internet and cable…
etc. Also since we are moving from
an apartment we have to consider new bills such as water, trash- other
unexpected expenses that we will no longer be able to call the landlord for. :(
We have come up with an
ideal monthly payment and are trying very hard to stay close to this
number. It’s my suggestion to
other buyers to do the same thing- figure out how much you can give to a
mortgage payment each month and work backwards to see how much you afford on a
house.
This is the most important
part of buying a home; it’s also the least amount of fun! But it is so
necessary and vital to avoid getting in over your head. So take your time and
really think about what you are comfortable affording.
Ok that's all I have right now- and I will try to make the next entry less math centered and focus on fun side of buying a house!!
JCS
JCS
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