It's important to keep the possibility in mind that you could be on the hook for other hidden homeownership expenses and plan well in advance. Here's how.
So, you’ve started the process of buying your first home! You’re probably looking forward to taking this major life step. Often, prospective home buyers are so excited about purchasing their new home that they tend to get a little bit ahead of themselves.
While you may want to put off the more tedious work in exchange for perusing beautiful homes on the internet, it really is crucial that you get a clear sense of how much home you can afford and how to buy a home before you get too far into the process.
Developing an emotional attachment to a home you can’t afford or making an uninformed decision can put undue strain on your personal finances. The stress that this will cause you and your family is not worth it.
Here is why it is helpful to get your mortgage score sooner rather than later.
It Will Help You Set Realistic Goals
Before you begin looking at homes, make sure you compile all of your financial information so that you can obtain your mortgage score early on in the home buying process. You should collect information on your savings accounts and your investments. Assess how much income you can count on for the foreseeable future.
You should also check in on your credit score to get an understanding of where you might stand with lenders early on in your home buying process. This will help you make the best decision for your individual situation.
While you are collecting your financial information to obtain your mortgage score, you will start to get a better idea of how much money you have available for a down payment and how much you can put towards monthly mortgage payments. But, many prospective homeowners forget to account for the hidden costs of homeownership. These can include things like closing costs, property taxes, maintenance and utility fees. These costs add up pretty quickly, in fact, closing costs alone can amount to about 1.5 to 4% of the selling price of the home! Your mortgage score will not forget these factors—it will define realistic goals so you can achieve them faster.
So don’t fall victim to leaving important costs out of your budget. Doing your homework upfront will help you set realistic goals about how much of a down payment you can afford and what type of mortgage you can carry. This is a crucial first step in the home buying process because closing on a deal for a home that is out of your price range can put you in a financial bind. The bottom line is, it will be impossible to enjoy your new home if you are overburdened with debt and financial stress. So, make sure to take this process one step at a time.
You’ll Save Time With An AI-Powered Mortgage Investor
Finding your mortgage score early in your search will help you save valuable time. If you’re having trouble making sense of all of your financial information, don’t worry. You’re definitely not alone. It’s a common problem facing many prospective home buyers. This is where Home Lending Pal can help. Our AI-powered mortgage advisor, Kev, can get you highly personalized information and recommendations very quickly. Before you even begin your search or finalize your budget, Kev will let you know what your odds of approval are from multiple lenders. It will also help you get a sense of the mortgage amount you are likely to obtain.
Kev presents all this information in a way that is simple and easy to digest. Our highly personalized and thorough mortgage score calculator will show you your anticipated approval odds for homes that you add to our system. Best of all, the mortgage score operates in real-time. So, if a home that was previously out of reach suddenly becomes within your budget you will be notified. Conversely, if a home you had your eye on is now unattainable you will also get a notification. This way, you won’t miss out on an opportunity to get a great deal and you also won’t enter into a financial agreement that will have you in over your head.
You’ll Feel Empowered To Make The Right Decision For You
It’s important to feel empowered, confident and well informed before you close a deal on a new home. If you are ever feeling unsure about your decision don’t feel any pressure to sign papers. It is crucial that you feel comfortable with your ability to pay off your mortgage on time before you commit to anything. Obtaining your mortgage score early will help you feel confident and in control throughout the entire home buying process.
If you’re looking for help assessing your approval odds, Home Lending Pal can help! For more information, look at our Frequently Asked Questions page or peruse some of the other articles from our Mortgage Blog.