| When looking into anything new, it is normal to | | | | several factors. Most lenders accept a five |
| have questions. Here are some common | | | | percent down payment, so you will need that up |
| questions and answers about real estate to help | | | | front. What remains after the down payment is |
| you gain that edge when deciding whether buying | | | | what you will borrow.You will have to figure |
| a home is right for you.Which is better: renting or | | | | interest, mortgage insurance, an escrow account, |
| buying? | | | | and possibly taxes as well. All of that is added to |
| Before buying, you need to determine what will | | | | the amount of monthly principal payments, and |
| save you money over the long run, and what | | | | that is your payment. Most lenders want to see |
| might be of the most financial benefit in the | | | | that your payment is only .28 of your income, |
| future. It is indeed cheaper to rent, even in the | | | | although some are stretching it to .30 or .32. Take |
| long run (according to a Joint Center for Housing | | | | your monthly payment (everything included) and |
| Studies of Harvard University study). Additionally, | | | | divide it by the percentage your lender finds |
| when you rent you do not have to pay | | | | acceptable. Then multiply by 12. That is the yearly |
| maintenance costs, as those are the responsibility | | | | income you need.So, if your monthly payment |
| of the landlord.However, there are tax benefits to | | | | expenses total 983 dollars, this is what you would |
| owning, and the home will likely appreciate in | | | | need: |
| value, allowing you to possibly make money. If | | | | 983/.28=3,510.71 |
| you buy a home now for 150,000 dollars, in a few | | | | 3,510.71x12=42,128.57.To be safe, you would |
| years is will likely be worth more than 200,000. | | | | need to make about 43,000 dollars a year. In |
| Additionally, rent always goes up, but your | | | | order to see if you can manage, open a savings |
| monthly housing costs remain relatively stable | | | | account and put the down payment in the |
| when you buy. Until you reach the end of your | | | | account. For six months, add the amount you |
| mortgage when it drops to zero.Ultimately, it is up | | | | would pay above your rent to the account (if you |
| to you to weigh the pros and cons. There are | | | | pay 600 dollars in rent, put 383 in the account |
| advantages to both renting and buying, and you | | | | each month). If you can handle the extra, you |
| need to determine what works for you.How do I | | | | can afford the house.How can I know whom a |
| figure how much house I can afford? | | | | real estate agent is working for? |
| The big question that needs to be answered | | | | When looking for help finding a home, many |
| before buying how much can one afford? To | | | | people turn to real estate agents. However, many |
| figure that out, you need to take into account | | | | agents are just looking to sell a home. |