Things to Consider:
Planning to move out of the area in
a couple of years? If so you may be better off not buying a home now.
The cost of selling a house generally falls in a range of 7% - 8% of
the sale price which may be more than the appreciation of the house.
Check out the
Rent vs. Buying Home Calculators
to compare the advantages of each. Thinking about changing jobs? It
might be best to wait until after your purchase. Look at your work
history. Is it sporadic or did you just start a new job? Lenders like
to see someone with a steady work history and with job changes in the
same line of work. Lenders will require your work history along with
past tax returns. Search for Boise
homes for sale
Look at your credit report before you go to a lender. It is not
uncommon to find problems with reports, especially if you have a
common last name. If you find a problem, start with the reporting
agency to clear it up. It is common to have a late payment at some
time or another. These problems can usually be taken care of with a
letter of explanation from you to the lender. We have Boise
real estate listings.
FICO Scores:
What They are and Why They are Important.
To get
copies of your credit report, start at:
Experian
My FICO Score
Banks/Savings and Loans vs. Mortgage
Brokers:
- Loan officers at a bank work for the bank.
-
Mortgage brokers
work for you and have a fiduciary relationship.
- Most banks cooperate with mortgage brokers.
- You can go to a broker and obtain a loan through
a bank.
- Most banks will offer you a menu of programs
while a loan broker will offer a
menu of lenders. Banks and mortgage brokers are under different
government controls.
- A complaint regarding a bank would go to the
State Department of Banking.
- A complaint regarding a loan broker would go to
the State Department of Real Estate.
Contact someone from each source to see what special programs they
have to offer.
Home Loan Pre-Approval:
- Before
shopping for a home, get pre-approved
for a home loan first.
- Getting pre-approved for a loan is a necessary
step when buying real estate.
- If you are
pre-approved for a mortgage
first you will save considerable time looking for a property.
- You will know how much a lender will commit so
you won't waste time looking at property you can't qualify for.
- You will have a better chance of having an offer
accepted if it is accompanied with a pre-approval letter.
- The best agents won't work with buyers until they
are pre-approved.
A mortgage lender will let you know your
maximum loan amount after providing them:
- Income from all sources.
- Funds available for a down
payment and closing costs.
- Your monthly obligations (auto
loans, credit card payments, alimony, child support)
- Price range of homes where you
want to locate.
Selecting a Mortgage Lender:
You
should pick a mortgage lender based on experience, customer service
and recommendations. Work with a mortgage lender who is experienced in
the business, knows the availability of the different type loans and
how to handle the demands of processing. Don't make the decision based
solely on which lender is offering the lowest rates. If a company is
offering a mortgage package that is well below market rates, you
should beware. All mortgage companies generally choose from the same
pool of investors. A company offering abnormally low rates might make
up the difference by increasing closing costs or tacking on additional
settlement fees. Search for Boise
homes for sale Determine how long you expect
to live in the new home. This decision will not only affect the houses
you look at, but also will determine the type and term of loan you
choose. Get everything in writing and a copy of everything you sign.
Ask your mortgage lender at application what fees typically are
included in the finance charge computation, and what fees may be
charged separately at closing.
How
Much Can I Qualify For? Most
mortgage lenders require your housing payments not to exceed 25-33%
(depending on your down payment) of your gross monthly income called
"housing expense ratio". Your total debt payments should not exceed
33-38%, figured on a monthly basis. This figure is called your "total
debt ratio". Use the
home mortgage calculators
to find out how much you can afford. We have Boise real estate
listings.
How Much Do I Need?
Besides setting aside money for a down payment, you will need money
for closing costs. Those costs can range from $3,000 to $10,000,
depending on the type of loan, the loan fees and the community the
property is located in. The smartest and most time efficient thing to
do is get pre-approved up front, before you start looking for a home.
Next, find an agent familiar with the area you want to live and you
are comfortable with. Educate your self about local property values
and the current market trend. Search for
Boise homes for sale |
