Buying Your First Home
Are You a First Time Home Buyer?
Here are the most popular options to choose from:FHA Loan - If your funds are not big enough to invest, consider taking a FHA loan. Required down payments for these loans can be as low as 3%. Insured by Federal Housing Administration, these loans also have a more relaxed credit history demands. 30-Year Loan - If you don’t mind a longer payment period, 30-year loans are designed for you. They allow you to practice smarter budgeting and a fixed payment schedule. Moreover, the rate won’t change during the lifespan of your mortgage. VA Loans - Are you a veteran or a spouse of a veteran? Or a current member of the military? If yes, then you can take advantage of VA loans designed specially for you.
Frequently Asked Questions
How much should I pay for a new house?
Generally, the ideal amount is the 28% of your annual income after tax. For a $60,000 annual salary, your perfect balance is at $16,800 or $1,400/month. However, since buying your own house is an important step, you should not limit yourself with this formula.
The best option is finding a monthly payment range you know you can pay. It should not interfere with other important costs you have, like health insurance, student loans, etc.
What is the cost of homeowners insurance and property taxes?
These costs will depend on your location and provider. Visit the official website of the provider to find out their insurance costs. You can also get an idea from tax estimators on websites of some states.
Additionally, talk to your agent to learn about the taxes in areas you want to buy a house in.
Should I really buy a house?
Buying a house is a serious commitment. You’ll have to pay a considerable amount each month to close your loan. That’s why, consider the following:
Answering these questions will help you understand if you really need to buy a house or not.
What is a closing cost?
After you last payment has been made, your loan needs to be closed. This includes some processing and administration work which you will need to pay for. It’s your closing cost.
You will be informed about your closing rate when signing up for the loan. Make sure to keep your Loan Estimate and the Closing Disclosure to avoid any unpleasant surprises in the future.