Many years ago, when I knew I’d be purchasing a house in the future, I started working on what I needed to do in order to qualify for a mortgage. I had a hunch that I needed to start sooner than later in order to achieve my goal and I’m really thankful I did.
If you are getting ready to purchase a new home, one of the very first questions you will be asked by your Loan Officer when you speak to them for the first time is: How much of a monthly house payment do you think you can afford?
Rent or mortgage payments swallow up between 25 – 35% of a person’s or family’s income. That’s a huge chunk of dough, especially for a renter whose rent money is gone forever. In contrast, at least a home owner has the potential to earn some of that income back when they sell their home. But does that mean renters get the short end of the stick and will forever be financially inferior to a home owner? According to Suze Orman, not necessarily; it’s what you do with your extra income that matters.
If you have decided to take the plunge and build your dream home the first thing you need to do is work out how you’re going to pay for it. Financing a self-build isn’t as simple as applying for a regular mortgage. Unless you’re lucky enough to have the capital to be able to pay for it all outright, you will need to apply for a specialist self-build loan.