Get A Philadelphia Mortgage – Ten Steps to Prepare For Owning Your First Home
Buying a home for the first time can make you feel both excited and terrified at the same time (not to mention finding the right Philadelphia home mortgage). However, with current home prices at the lowest they have been in years, mortgage interest rates at or near all time historic lows, in addition to an $8000 tax credit available to first time home buyers, right now is a great time to purchase a home. Below you will find 10 steps to guide you towards home ownership:
1. Know what you can afford as far as a Philadelphia mortgage. The general rule of thumb is that you can afford between 2 and 3 times your gross income.
2. Create a home “wish list”. Then, prioritize the features on your list.
3. Select where you want to live. put together a list of 3 or 4 neighborhoods you would be happy living in, and remember to take into account things like schools, parks, growth plans and general safety.
4. It’s never too early to start saving. Do you have enough money saved to qualify for a Philadelphia home loan and cover your down payment? In an ideal situation you would have 20% of the purchase price saved to use as a down payment. And don’t forget to factor in closing costs. Your closing cost, which include taxes, title/attorney’s fees, transfer/recording fees etc ? typically cost between 2% and 7% of the home price.
5. Be sure your credit is in order. Get a copy of your credit report and look it over carefully to make sure it is accurate. If there are any errors, make sure they get correct right away. Your credit report plays a huge role in getting a loan as it shows how you handled credit in the past including all your bad debts and late payments, if you have any.
6. Figure out how much of a mortgage you qualify for. How much money do you qualify for? Be sure to look at different loan options too ? such as 30-year or 15-year fixed mortgages or Adjustable Rate Mortgages (ARMs) ? and decide what’s best for you.
7. Get a pre-approval. Organize all the documentation a Philadelphia lender will need to preapprove you for a loan. Some common documents you will most likely need include 2 years of W-2s, your most recent 2 months pay stubs, most recent 2 months bank statements and your account numbers.
8. Weigh other sources of help with a down payment. Do you qualify for any special mortgage or down payment assistance programs? It would be worthwhile to check with your local government and/or state agencies to see about these kinds of programs. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal.
9. Figure out the total cost of Philadelphia homeownership. This should include property taxes, insurance, maintenance and utilities, and association fees, if applicable.
10. Find a good Philadelphia Realtor. Some first time buyers opt to try to do the deal alone rather than getting an agent. Why even bother? An agent is there to represent you and make sure you get a fair deal. And don’t forget, as a buyer you’re not going to have to pay to have that agent work with you.