The idea of purchasing a home may be filled with bright lights and shiny objects, however the reality of it can be as daunting as any other adulting task. This is especially true when you have a monthly budget that you are sticking to. The following tips will help you stay on track with your monthly budget instead of focusing on the shiny objects when purchasing a home.
- Have a budget, its the least you could do when purchasing a home and it will set you up for the financial responsibility that comes with home ownership. Your budget includes your monthly expenses, savings, investing, and how your monthly income is allocated towards each category. When you speak to a mortgage lender, advise them of the amount you have allocated towards your monthly mortgage payment.
- Pre-approval amount, is not the same thing as your budget amount. Your lender will approve you based on your income and debts from your credit report. The lender never considers your utility bill, car insurance, health care costs, and other expenses that may not show up on your credit report. Which means you could be approved for far more than you can actually afford. Again, once you tell your lender the amount you have budgeted for your monthly mortgage payment, they will be able to provide you a pre-approval amount based on that number
- Shining isn’t winning, especially not when the shiny objects are only there to cover up more underlying issues. More than likely a newly renovated home is an older home that was brought up to date. These new renovations will cause the homes to be more expensive than it would have been if you purchased before the renovation. Consider purchasing a home that needs a few modern updates. This will guarantee lower monthly payments and you will at least know that the structure beneath the shiny objects are in decent condition, plus you’ll have plenty of time to make the house the way you like it.
These tips are best used for a buyer who is still considering purchasing a home or in the beginning stages of house hunting. Sticking to your budget will not only help you in this short term purchase it helps in the long run as well. If you want to learn more tips on how to create a budget check out Learnvest.com and Mint.com. For more information on preferred lenders contact me directly email@example.com