Get a Quality Home or Mortgage With Big Thing Buying Skills

Home or Mortgage; Buying an Affordable Low Maintenance Home and Get a Quality Mortgage

quality home or mortgage

YOUR BUDGET

The first thing you have to ask is, “How much house can we afford” The payments include P+I+T+I (principle+interest+taxes+insurance). Most of your payment will be principle and interest, taxes vary according to state, and insurance is not a very big cost. But, you can figure it out with most online calculators. You have to know how to calculate P+I+T+I to get a quality home or mortgage.

You should be stable in your job or with your business before you decide to take the leap to sign on with a mortgage.  Most banks want you to be on your job or in your business for a solid two years. Set up a file system for steps 1-8, don’t rush and do your research.

Step 1

MORTGAGE COST

This is a typical cost of a home or mortgage with average tax state, always find out how much typical insurance and taxes are in your state before you decide your budget. Choose a home price you think you can qualify for based on total payment. You will keep adjusting home price until you can find one that is close to your budget. Use my mortgage amortization calculator at LiveRichCalculators.

Say your home or mortgage costs are as follow:
$300,000  price of home
at, 4% interest
30 year
Taxes=6000/yr
Insurance=500/yr
Monthly Payment and Interest=1,432.5
Monthly Taxes and Insurance=541.67
Total Payment=$1,973.92

Step 2

DOWN PAYMENT AND ESCROW COST

Find out what a typical down payment is at your credit union, bank, or mortgage company. Now, make sure you have the savings or start a savings account with the down payment and escrow cost. If you find a buyer who is anxious to sell and they have a lot of equity in their home sometimes you can negotiate that they pay your buyer’s escrow cost.

For the example above the downpayment is:
5%=$15,000
A 1% escrow cost = $3000

Step 3

MAINTENANCE COST

Allow a monthly saving account for maintenance cost, most homes have maintenance repairs from time to time.

Old homes usually have a higher maintenance cost than newer homes, unless all electrical, plumbing and other major items replaced. The important aspect of a good home is a good inspection, preferably by tradesmen. I prefer hiring an actual plumber, electrician, and carpenter to inspect your new home instead of one single home inspector. Some of those home inspectors only take a 6 month home inspection course.

The tradesmen work in the field every day for years. You should also do your own inspection with a moisture meter and electrical meter to see if there are any glaring defects. If you place a marble on the floor does it roll or stay put, if it rolls you could have a damaged foundation. That is extremely expensive to repair. If you know the repairs you may be able to add those into your mortgage and fix after your move in.

Step 4

CREDIT REPORT

Get a copy of your credit report before you start to look for a home. Read it carefully. Some people are shocked at the mistakes that get on their credit report. Make sure you document the mistakes on your credit report and challenge them with Experian credit bureau. Experian will usually send the corrections to the other bureaus. When all corrections are in place, get another copy of your credit report,
and credit score. Getting an affordable, quality home or mortgage starts with a good credit report and high credit score.

Step 5

PAY OFF BILLS

You know what your bills are, and you know if they are excessive. You will need to find room in your budget for a mortgage. You don’t want a mortgage that increases your current bills per month too much. Like you don’t want to get from $500 per month of rent to $1900 per month for a mortgage unless you have been saving at least $2500 per month so that savings will go into your mortgage.

You should also still have room for a savings account or two after you get a mortgage. You will need savings for home maintenance, car maintenance, and general emergencies. Pay off as many bills as possible before you start a mortgage.

Step 6

SAVE FOR A DOWN PAYMENT AND CLOSING COST

Down payments are ranging anywhere from 5% to 10% down. Then, there are buyers closing cost you must pay also. This is usually a surprise to new home buyers. Closing cost is typically 2 to 5 percent of the purchase price. So, for a 300,000 home, the closing cost would be about $9,000.

Step 7

MORTGAGE RESEARCH

Before you decide to use a financial institute, do your research. If you have a credit union or local bank you do business with and you have good credit, it is usually relatively easy to get a loan at one of those places and you will save on additional cost that is charged by mortgage companies. If you can’t get financing from your credit union or bank, research the best mortgage companies in your area. You can also ask friends and family who they had good luck with.

Before your visit anyone for a mortgage. Research mortgages, make absolutely sure you understand what a quality mortgage is. Know what the current rates are for a 15 year or 30-year mortgage. Don’t allow anyone to give you a low-quality mortgage, if they think you have not done your research, some will try to give you a low-quality mortgage, even if you qualify for a high-quality mortgage. If you qualify for
a  low-interest high quality conventional low-interest rate 30-year mortgage, make sure you get one. The industry is full of nice, dishonest people, protect yourself.

Step 8

MORTGAGE RATES AND QUALITY

Call your local credit union or bank to get current rates on quality mortgages.

Use my mortgage calculators at LiveRichCalculators.

Use the department of housing website to read about various types of Mortgage Issues.

This is most of the information you need to purchase a quality home or mortgage if it is your first home or your second or third. These facts will help you to buy a quality affordable home with low maintenance.

Start with my free personal finance worksheets available on this website.

Remember that buying a home is a serious process. You should take your time and be very methodical.
Some places have home prices that are outrageous – in that case, you may have to drive a long distance to get to work, by living in an affordable area further from your center of town. Some towns have affordable housing compared to income. Take your time it may take anywhere from 6 months to 5 years to go through the process I list above. To get to your maximum financial health, allow me to give you a Discovery Session, to see if I can help.

Here are some helpful tools you can use now! All free for my readers
1. There is a Free Personal Finance Worksheet waiting for you
2. You can download your free debt free cheat sheet
3. Get your Free Debt-Free book excerpt now

I am available for a FREE Discovery Session, you can discover if I can help you will all of your personal finance needs.

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About Lois Center-Shabazz

Lois Center-Shabazz, aka MsFinancialSavvy, is a Money Strategist specializing in helping others with Mega-Money Management through what she calls the Money Trio of Guerrilla Budgeting | Sane Savings | Investing Insights. Visit the top toolbar of MsFinancialSavvy.com and schedule a discovery session with Lois. She is also a nature photographer (www.arbazz.net), acrylic painter (www.artbazz.com), and has an online calculator website at www.livericalculators.com. Lois is the author of the Live Rich Save Money! series on Amazon Kindle.

12 comments on “Get a Quality Home or Mortgage With Big Thing Buying Skills

  1. Wow! I wish I could find a house for $300k. The houses in my neighborhood are around $1.5M. I couldn’t tell from your post what escrow is. Can you explain what that is? The cost may come down, it looks like things are going in the direction of down. The interest rates are creeping and there are other signs in the mortgage market. But, at that cost, you will most likely have to move further from the center of things.

  2. Great timing, my fiancé is on the process of looking for our next home. It’s just sad that we are living in one of the most expensive place. I guess we just have to be smarter in spending our money 😉

  3. I’m about to start saving for my first house so this has been really usefull! There’s so much to consider x

    Sophia x sophiawhitham.co.uk

  4. This is a great breakdown on buying a house. I will save this for anyone I know who is starting to look. Thanks for the information!

  5. I’m not ready to buy a house yet, but I think this information is definitely helpful! I liked how you linked the calculator and worksheets so the process is easier!
    clairebearblogs.com

  6. I don’t own a home yet but it’s such an extensive and complicated process! Doing your research and doing those worksheets are good things to do!

    Carly | thecarlycollective.com

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