Before You Look at Your First House

Experienced home buyers know that one of the first-steps in beginning a successful search for a new house is taking a hard, objective look at finances. Determining how much money you can dedicate to the purchase of your new house affects almost every aspect of buying a home – including how we write the offer, which mortgage programs you will qualify for, shopping for the best mortgage loan and which homes are truly in your price range.
Here are questions that each home buyer should ask:

  • Your Buying Power Real Estate SarasotaHow much cash is available for a down payment?  The amount available for down payment will affect what types of loans you can qualify for.       Learn more about down payments.
  • Am I ready to write a check for the earnest money?  Earnest money is a cash deposit made to a home seller to secure an offer to buy the property. This amount is often forfeited if the buyer decides to withdraw his offer.
  • How much additional cash will be available to pay for closing costs?  There are certain standard costs associated with closing the sale of a house. These fees are split between the buyer and the seller, as spelled out in the sales contract.       Learn more about closing costs.

What is the maximum monthly mortgage payment that I can afford?  Most lenders will use the 28/36 rule to determine the maximum mortgage payment you can afford.

The 28/36 Rule

Mortgage lending guidelines usually will not allow more than 28% of your gross income to be applied to your mortgage, real estate tax and homeowner’s insurance payments, and not more than 36% of your gross income to be applied to your mortgage expenses PLUS your regular debt expenses, including car payments, credit cards, and other loans.

Contact Us today so we can help you find your perfect home or call the Wilson HomeTeam at (941) 321-8686 now for immediate answers to your questions