NEW HOME LOANS
Are You Ready To Purchase A House But Unsure Of How New Home Loans Work?
Are you currently renting? Do you want to buy your own home? Buying a new home is one of the most significant investments you’ll make. New home loans can be tricky to navigate and this is where we excel.
It’s also a long-term commitment. You must consider factors like current cash flow, local markets, interest rates, length of stay, possible tax deductions and upfront costs.
For instance, how much of your monthly income goes to housing? Some experts say it should be around 28% to 30%. Consider this when you start paying for a house.
Another way to check is to use the price-to-rent ratio. Divide a home price by the annual rent of your current rental unit. If the ratio is under 20%, you’re probably better off buying your own home.
There’s also the lifestyle factor. Owning your own home means you must deal with your own backed-up toilet or a leaky roof. This time, there’s no landlord or lady to call.
However, all of these are part of becoming a responsible home-owning adult. Eventually, you’ll want or need to buy your own home. And if that time is now, then you must be financially prepared.
Quick Guide For New Home Buyers
Congratulations on taking this huge step! It’s exciting and nerve-wracking. Looking at properties is just one of the many steps you need to take. The more challenging and most important task at hand is obtaining a mortgage.
A mortgage is a debt instrument. It is also called ‘claims on property.’ Homebuyers use a mortgage to purchase real estate, so they don’t have to pay for the large sum upfront. Over a specified number of years, the borrower repays the loan, with interest.
In most cases, sellers and real estate agents will require you to get pre-qualified for a mortgage. You’ll need to talk to a lender for pre-qualification. This gives you an idea of the loan amount you will most likely be approved for.
Getting A New Home Loan
For starters, you need down payment. Before starting the home buying process, you should have some money saved up that can cover up to 20% of your target home’s purchase price.
You should also check your credit score. Get a copy of your credit report. Will mortgage firms consider you a ‘good’ borrower? If not, you need to work on improving your score.
While your loan is being processed, maintain your good credit. Do not apply for a new credit card. Avoid applying for other loans.
How much can you realistically afford? You can use a mortgage calculator to check. This handy tool lets you calculate your monthly home loan payments. You can check this against different loan terms, interest rates and loan amounts.
Before meeting with a mortgage lender, make sure to prepare all your documents to expedite the process. At the very least, have your credit report, W-2 tax form, tax returns and bank statements ready.
Your lender will advise you of other documents you’ll need. It is also crucial to be prompt when submitting paperwork. This is to avoid delays that can cause problems, such as losing your deposit.
There Are Different New Home Loans Options For Each Buyer, Depending On Your Unique Financial Situation.
It is important to find a reputable and reliable mortgage company that will guide you through the process. Whether you’re just starting or you’re halfway through the process, Sun Mortgage Funding can help you with new home buyer loans or new home building loans.
We understand that it can be challenging, especially if you’re a first-timer. We’re here to help make it easier, for you and your agent.
Give us a call and let’s discuss how we can help you.