Our newest applicants are on the right track in terms of managing their money and making sure they do not get themselves into a financial bind by spending more than they have on a home. They are looking for tips on staying on a monthly budget. The first step is to arrange for a mortgage with the largest down payment they can afford and the lowest interest rate they can find. This will help to ensure that their mortgage payments are as low as possible.
They have a good credit rating and should qualify for a relatively low interest rate mortgage for as long a term as they wish. They have taken the right steps by building up a large down payment. Even though they have lived with his wife’s parents for a year, this has allowed him to build up a large down payment, which is the first step in managing a monthly budget.
We also urge these applicants to estimate their monthly taxes and the utilities that will need to be paid. Adding up all of these figures will provide an estimate of the total monthly cost for their home including principle, interest, taxes, utility costs and maintenance costs.
The big unknown is what repairs will be required once they take possession of the home. We urge then and in fact it is required in many states to have a home inspection before they finalize the purchase. This inspection is extremely important to establish what repairs will be needed on the home. Since this is a foreclosure sale, the bank will not make any repairs. The best the customer can do is to negotiate the price down further to cover any identified repairs that may be needed.
We anticipate further discussion on this file since the sale of the home is no where near being finalized at this stage.