Seriously thoughtful Making strides towards becoming a first-time homeowner

[Dhevi]

In light of recent events concerning a coworker/friend taking on a mortgage to become a homeowner, I've caught the bug thinking "why not me?"

A year ago when asked, I had great reservations. Still do. There's a lot of uncertainty involved when talking of a mortgage loan to buy your first home. I wasn't eager or ready then, but a lot has changed since.

I've established a better foothold at my job earning recognition and further compensation. I've taken on more responsibilities and have matured my work ethic. I applied for an advanced position, and though a better candidate was selected, my drive to rise in the company has not faltered or diminished.

I'm in a better position now, that owning a home as opposed to being a renter-for-life seems more than feasible.

Now begins the planning stage. Oh boy.

Any parties who might have any words of warning or helpful thoughts are appreciated.

[FizzyWater]

The "experts" will tell you how much house "you can afford". But only you know your comfort level for debt, your discipline for budgeting, and your personal needs. Don't let them talk you into something larger than you can comfortably live with.

Make sure you have a solid down-payment saved - many of the folks who got in trouble were those who couldn't save and only put down 1-2%. And the old standby still stands - you should always have at least 3 months' salary in savings that's not part of your down-payment in case of emergency.

Ask questions and take notes. Make sure you understand how your mortgage works. I'm in central Ohio and I know of a few places that will offer "first time homebuyers" seminars - they help people learn the basic vocabulary. There are some online as well, for those who aren't free when the (typically early evening) classes are offered.

[kindlekitten]

I'm a realtor so can answer many of your questions. The most important thing to start with us developing a relationship with a lender. Do NOT go to a regular bank. Find a mortgage broker that is local to your area. There are several different lending programs you may qualify for and they have different amounts of down payment amounts anywhere from zero to twenty percent. The financial part of buying is the longest stage. I have clients that I've worked with for over two years.

Get a recommendation for a realtor either from the lender you choose or friends that have purchased recently. If you have any questions as you go forward, please don't hesitate to ask, I'm delighted to help.

[Dhevi]

Thank you Fizzywater and Kindlekitten. I appreciate your advice.

Working on the backside of the mortgage industry concerning taxes, insurance and escrow I have working knowledge on the behind the scenes matters. There remain many questions that I will work out over the course of the next year to two to educate myself prior to making any long term commitment and your tips have given me a good start.

[Angst]

Don't forget you have to budget for closing costs too. and repairs. and utilities. and moving costs. and property taxes. and insurance. and additional insurance if you don't make 20% down.

[kindlekitten]

any good lender and escrow company is going to have the lion's share of those figures sorted out and more than likely built into the loan