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Before You Start Looking For A HomeBefore you start looking for a home, it is essential to know how much you can pay for a home.  Your lender can make this easy for you, by pre-qualifying you before you and your real estate agent begin looking for a home. A pre-qualification is free and can usually be done in just one visit, or even in one phone call. By doing so, you will know what price home you can afford and what your monthly payments will be. The best part of this step is that we put everything in writing. What real benefits do homeowners have? Being a homeowner gives one a sense of stability and permanence. It gives the flexibility to make home improvements that meet your specific needs wherever and whenever you want to. You are not subject to periodic rent increases, and the interest you pay may be deductible from your taxes, in some cases up to 100%. Consult with your tax advisor. How much of a down payment should I make? The amount of down payment that you pay can vary. It depends on what you and your home loan consultant decide is best before you start looking for a home. It is important that you know that the lower the down payment, the more you will have to pay each month, that it will be more likely that you will have to purchase home loan insurance, and that your interest payments will be higher as well. Insurance that prevents the lender against loss if the borrower should default on the home loan. What is the difference between applying for a loan and getting pre-qualified? Before you begin to look for your home, it is important that you visit a trusted home loan lender, who will analyze your assets, debts, and sources of income. Based on the preliminary analysis, they will tell you the amount of loan for which you qualify – this is called a pre-qualification. Once you find the home you want to purchase, you can then formally apply for your loan, and they will ask you to provide the necessary documentation (e.g. pay stubs, bank account information, etc.) to verify that the information you provided during your pre-qualification is accurate. What is a credit report? A credit report contains your payment history, shows that you paid your debts on time, if you have ever been late in making payments, or if you have ever failed to make payments. Lenders use the credit report to determine a potential borrower’s ability to make timely payments, and to judge whether or not the person would make a good prospect for a loan. If you are thinking about buying a home, you will need to show us that you can make your payments in a prompt and responsible manner. We recommend that if you do not have any purchases on credit, that you at least get a credit card, in order to establish a payment history. You can ask your home loan consultant for suggestions as well. How much money do I need for a down payment? Before you start looking for a home, you should have an idea how much you want to pay for a home and how much money you have available. If you do not have much money available, there are government programs that have been created to help first-time homebuyers. We offer a variety of loans that can normally accommodate each borrower’s needs. Some of these programs have less stringent qualification guidelines, while others require little or no down payment. In many cases, the money needed for the closing can be incorporated into the loan amount, reducing the amount of money a borrower needs to have on hand to purchase a home.  Return from Before You Start Looking For A Home Return from Before You Start Looking For A Home
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