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Facts for First-Time Home Buyers to Consider During Home Buying Process



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By : marco benavides    99 or more times read
First-time home buyers can sometimes get overloaded with information during the process of looking for a mortgage loan and buying a home. It is therefore imperative to consider some things before even getting involved in the process. If you go into the home-buying process without a clear and concise idea of what you need, you might run into problems. You might also run into problems if you have not taken into account how much you can actually afford in mortgage loan payments.

Much has been made of people actually not wanting to pay mortgages when they owe more than their home is worth. However, according to an article in Time Magazine back in July, most mortgage defaults still happen because homeowners cannot pay the mortgage. With this in mind, you should make some serious calculations as to how much you can actually pay toward a mortgage loan without putting yourself in a financial bind.

This means that you need to add up your credit card payments, car payment and all your other bills to see how much money is going out of your income to pay for your debts. If your debt obligations and your mortgage loan payments are over 36%, mortgage lenders will normally reduce the amount that you can borrow for a mortgage. Financial institutions want to be as sure as possible that you can pay the money that you are going to borrow for your mortgage. Therefore, if you have many debt obligations, it would be better to pay down your debt and wait to buy a house.

For renters, the best advantage that homeownership has over renting is that you will actually be building equity in your home. It is an investment that will pay off as you make more payments on your home mortgage loan. You will not see much equity during the first few years of the loan because of how much interest you pay off in the beginning. However, the loan balances off in the middle and actually tilts to your advantage toward the end. As a renter, the apartment or house that you are living in will never be yours as long as you are paying rent.

If you are wondering whether you can buy a home despite having bad credit, you should look into some of the mortgage loan programs offered by the federal government. You might want to contact a housing counseling agency funded by HUD. You will find that the federal government offers potential home buyers a lot of information and assistance. You simply have to contact the corresponding agency and request information on the government programs being offered. It is to your advantage to go into negotiations for a home mortgage loan with as much information as possible.

The information you gather will help you determine whether buying a house is right for you at this time and what you have to do in order to get the best terms available. For those who determine that they can meet their debt obligations and mortgage loan payments, owning a home is quite a satisfying experience. Owning a home provides your family with stability and security and most people consider these things priceless.
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