Whether you can afford to purchase a home depends on the cost, your income and expenses. Start by analyzing your current financial situation, and anticipate what your new obligations will be once you purchase a home. Itemize and record your current monthly expenses over a 3-month period. Review your spending habits, and see if you need to make any adjustments. Determine if you have the available income to cover the additional costs of home ownership including a mortgage payment, property taxes, repairs and maintenance. Speak to a mortgage specialist to see how large of a mortgage payment you can afford.
Devise a budget plan, and prioritize your spending so you'll be able to save more for the down payment and closing costs. Manage your credit cards wisely. Avoid making large purchases and incurring more debts that may affect your ability to qualify for a mortgage loan. Protect your credit to ensure a good credit rating by paying bills on time. Assess your current savings plan. You should set aside at least 3 months worth of living expenses in an accessible savings account for an emergency situation. With proper planning, you may be ready sooner to owning that special home.
Compliments, Article from Colorproductive newsletter
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