Before you start looking for a home, you will need to know how much you can actually spend. The best way to do this is to get preapproved for a mortgage by a lender. To get pre approved, you just need to provide some financial information to your mortgage banker, such as: your recent pay stubs, past 2 years of Income Tax statements, the amount of savings and investments you have. This will help you to save time when looking for a home that later you realize you are unable to actually afford it.
It’s important for you to consider any important life changes when finding an affordable and comfortable monthly mortgage payment. What if in a couple of years after you purchase your home, there’s a loss of income? To minimize the negative impact on your credit score, some lenders suggest that you can afford mortgage payments totaling about 1/3 of your gross income;however, others suggest closer to 20% for housing related costs.
Buying a home is a long term financial commitment that you should consider everything before starting your search for your perfect home. Doing this will guarantee that you have the most pleasant home buying experience of all.
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