Buying a Home: Five Considerations Beyond Low Mortgage Rates

There's no question that current low mortgage rates offer a great opportunity for first-time buyers and that potential homebuyers shouldn't wait too long to get a mortgage in place. A low mortgage rate can help you buy a larger home or qualify for a mortgage loan with lower monthly payments. However, there's more to buying a home than just getting attractive mortgage rates. Considering the following points can help you decide if you're ready to jump in and gain the dual benefit of lower home prices and low mortgage rates.

Mortgage Loan Options, Financial Goals, and More

• Understand the process. Are you aware of what's involved in buying a home and finding a mortgage loan? Taking a home buyer education course can help you learn about mortgage loans, down payment assistance programs, and the mortgage application and closing process. Mortgage lenders, real estate professionals, and government departments such as HUD or state housing finance agencies?can help you find a home buyer education program.
• Estimate ongoing costs. Owning a home requires more than making a mortgage payment each month. Are you prepared to pay for property taxes, insurance, routine maintenance, and emergency repairs? Estimating ongoing costs can help with accurately budgeting for home ownership.
• Know your finances and credit history. Although it's possible to get a low down payment mortgage loan through FHA programs, many lenders currently require at least 10% down. Add to your down payment an estimated 3% to 5% of the purchase price for closing costs and points. If you have less than excellent credit, you can expect to pay higher mortgage rates.
• Don't expect quick equity gains. Homeowners traditionally expect to gain equity in their homes as home values increase. In today's economy, it's difficult to predict how housing markets may perform. Don't buy a home with plans for getting rich quick.
• Ignore pressure to buy from others. It's common for family members, friends, and co-workers to encourage buying a home. The only reason for buying is that you're ready to buy. If you're unsure about taking on the commitment of owning, do some research. If you're still not ready after educating yourself and crunching the numbers, you can save toward buying a home later.

Finding the right mortgage loan and taking advantage of first-time home buyer programs? can help you increase buying power or save money.

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Karen Lawson
Karen Lawson is a freelance writer with extensive experience in mortgage banking and home loan loss mitigation programs. She holds BA and MA degrees in English from the University of Nevada, Reno.

Vital Information for Potential Homebuyers http://www.communityhousingdevelopment.org http://www.communityhousingdevelopment.org/homebuy.html

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