| Housing prices are down, but credit is tight. Even if you | | | | - whether you have kids or not. Great schools add to |
| find your dream home at an affordable price, you | | | | the value of your home, and they'll tempt buyers if you |
| might not be able to secure a mortgage loan. That part | | | | ever decide to sell someday. |
| of the housing crisis equation is out of our hands; it's | | | | Question 2: How's My Credit Looking? |
| going to be a matter of time and government | | | | Before you buy a home, get pre-approved for a |
| intervention before the housing and credit markets | | | | mortgage. The lender will take a hard look at your |
| recover. In the meantime, take advantage of the lull to | | | | finances, including your debt to income ratio and your |
| make sure you're really ready to buy a home. | | | | credit history. It's getting harder to find financing, so |
| Mortgage payments are one of the biggest drains on | | | | really buckle down and pay off your credit cards and |
| a person's finances. Don't get one unless you're sure | | | | other unsecured debts. You'll want your credit to be in |
| it's time. | | | | top shape. Make sure to have a history of timely |
| Buying a house is like choosing a spouse. You want | | | | payments that goes back at least 12 months - |
| one that's affordable, decent-looking, and able to keep | | | | preferably 24. Also, don't apply for new credit for |
| you happy for years to come. But how will you know | | | | several months before home-shopping; too many |
| when you're really ready to settle down and invest in | | | | inquiries can reflect poorly on your credit score. |
| what will (hopefully) be a long-term endeavor? There | | | | Question 3: How Much House Can I Afford? |
| are a few questions you should ask yourself before | | | | This is a very important question. You want a good |
| you take the plunge. | | | | house, but you don't want to live on Spaghettios just |
| Question 1: Am I Ready to Stay in One Place? | | | | so you can afford your mortgage payment. In general, |
| It seems like some people are never happy. When | | | | you can afford a mortgage equal to two and a half |
| they live in an apartment, they lament the fact that | | | | times your yearly pay. Someone making a salary of |
| they don't own a house. When they buy a house, they | | | | $50,000 a year could theoretically afford a $150,000 |
| regret the loss of freedom to move wherever they | | | | mortgage. For a more specific look at your situation, |
| wish. One thing's for certain: a house, much like a | | | | speak with a mortgage lender or do your own |
| marriage, will keep you tied down. If you're ready to | | | | calculations online. FICO has a good mortgage loan |
| settle into a permanent dwelling, this is a good thing. If | | | | calculator at their web site. |
| you're still undecided about where you want to put | | | | Buying a house doesn't have to be a nightmare. Doing |
| down roots, do yourself a favor and don't buy a house | | | | the groundwork beforehand will take a lot of the |
| until you can stay put for seven years or more. Sell | | | | stress out of your home buying experience. Just make |
| the house sooner, and you might lose money on | | | | sure you're ready to be a home owner, and do the |
| transaction costs. | | | | math to see what you can realistically afford. Then sit |
| When you *do* feel the urge to settle down, make | | | | back and smile, because you're buying a house the |
| sure you choose a location with a good school district | | | | smart way. |