OK you want to buy a house, now what? Buying a home is great and there are plenty of articles on the benefits etc. But let;s talk about just buying a home. More specifically, the financials associated with buying a home.
Can you afford it? The most basic qualifications allow you to finance and purchase a home with ratios as high as 45-50% of your gross income. Though most agree a number in the 33-38% range would be more preferred. So even today, we as lenders are able to offer a homebuyer good financing and allow for a reasonable amount of debt to income levels.
How much money do I need to bring in to close? Just because you are putting down 10% doesn't mean you won't bring in a amount at 10-15% of the sales price. In addition to the down payment most buyers will need to bring in interest and taxes for a prorated amount of time, you also may need to bring in closing costs for escrow, title, recording, notary, transfer tax, hoa fees, appraisal, tax service, etc etc. Many of these fees can be credited by the lender for an increased interest rate, or by way of seller or broker credits. These amounts and percentages may be capped on some mortgage programs.
How much documentation does it take. Pretty much everything over the last 90 days from bank statements to paycheck stubs, Your gonna need a ton of information, But if you are organized and retain your records as recommended you should be fine.
Get your trusted mortgage advisor involved before you start shopping. Get Pre-Approved by a lender like me to know EXACTLY what you are getting into.
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