Every morning I search the internet to see what is new in Mortgage Lending. I ran across this article and thught it was a good article for those getting ready to enter into a new mortgage
Don't let financial ruin kill American Dream
The lowdown on getting a low down payment loan
Shirley Nault has been a mortgage professional for over 20 years in the mortgage industry. Many of these years she has been a mortgage underwriter/manager. You can visit her other web sites at www.mtgview.blogspot.com, www.dutips.blogspot.com or www.naultfhatips.blogspot.com
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First and Formost Set a Budget
As Americans we overspend! We self indulge! Bankruptcy and foreclosure is the highest it has been in decades. Filing bankruptcy or having your home go into foreclosure is a painful process. These avenues where set up to help us out when those unexpected things happen in life like catastrophic illness or loss of employment etc. Too often these steps are taken because of lack of planning on the consumers’ part.
Now is the time to set a budget. I have always set a budget but have advoided meeting with a financial planner because I thought they would take away my freedom to choose what I wanted in life. I found out that their goal is to help me get what I want in life sooner. You may or may not want to get with a financial planner but make sure you at least commit to a budget.
Before you set down to do a budget think about (if you have a significant other include them) what you want to do in life. How soon do you want to retire, what kind of vacations you want, what major expenses do you have coming up such as education etc.. List the things that you want to accomplish and list the debts you have. Decide how much money you can spend a week for an allowance to eat out, go to the move or what ever your interest is. Make sure you allow for income tax and charitable donations and a must 401k/savings. Once you have your list together you are now ready to look at what income you have to work with.
Do you know how much money you really make? Review you pay checks and what your take home pay is. Did you have to pay taxes last year? Are you paying enough federal and state taxes, do you need to inculde more taxes in your budget?
After you have compared your income to your current debt and what your goals are ask your self how much can my house payment be (this must include your house payment, property taxes, hazard insurance, mortgage insurance if applicable and any homeowners association fees) ?
Lenders like to see houseing between 28-31% of your gross monthly income of course lower is always better. Personally I could never afford a housing ratio of 28-31% I like other things too much. My housing debt has typically been around the low to high teens.
Mortgage brokers/lenders don't usually want to see your total debt over 38-41% of your total monthly income. This is your housing debt along with consumer debt (does not include utilities, taxes, chartable contribution, day care)
There are some good web sites out there to help you get started on a budget.
Don't Bit off too much house
Basic Budget worksheet
Top Things to know
DO NOT LET THE LENDER/REALTOR TELL YOU WHAT YOU CAN AFFORD THEY MAY TELL YOU TO BUY MORE THEN WHAT YOU CAN AFFORD! REMEMBER THE OTHER THINGS YOU WANT IN LIFE!
Shirley Nault has been a mortgage professional for over 20 years in the mortgage industry. Many of these years she has been a mortgage underwriter/manager. You can visit her other web sites at www.mtgview.blogspot.com, www.dutips.blogspot.com or www.naultfhatips.blogspot.com
Now is the time to set a budget. I have always set a budget but have advoided meeting with a financial planner because I thought they would take away my freedom to choose what I wanted in life. I found out that their goal is to help me get what I want in life sooner. You may or may not want to get with a financial planner but make sure you at least commit to a budget.
Before you set down to do a budget think about (if you have a significant other include them) what you want to do in life. How soon do you want to retire, what kind of vacations you want, what major expenses do you have coming up such as education etc.. List the things that you want to accomplish and list the debts you have. Decide how much money you can spend a week for an allowance to eat out, go to the move or what ever your interest is. Make sure you allow for income tax and charitable donations and a must 401k/savings. Once you have your list together you are now ready to look at what income you have to work with.
Do you know how much money you really make? Review you pay checks and what your take home pay is. Did you have to pay taxes last year? Are you paying enough federal and state taxes, do you need to inculde more taxes in your budget?
After you have compared your income to your current debt and what your goals are ask your self how much can my house payment be (this must include your house payment, property taxes, hazard insurance, mortgage insurance if applicable and any homeowners association fees) ?
Lenders like to see houseing between 28-31% of your gross monthly income of course lower is always better. Personally I could never afford a housing ratio of 28-31% I like other things too much. My housing debt has typically been around the low to high teens.
Mortgage brokers/lenders don't usually want to see your total debt over 38-41% of your total monthly income. This is your housing debt along with consumer debt (does not include utilities, taxes, chartable contribution, day care)
There are some good web sites out there to help you get started on a budget.
Don't Bit off too much house
Basic Budget worksheet
Top Things to know
DO NOT LET THE LENDER/REALTOR TELL YOU WHAT YOU CAN AFFORD THEY MAY TELL YOU TO BUY MORE THEN WHAT YOU CAN AFFORD! REMEMBER THE OTHER THINGS YOU WANT IN LIFE!
Shirley Nault has been a mortgage professional for over 20 years in the mortgage industry. Many of these years she has been a mortgage underwriter/manager. You can visit her other web sites at www.mtgview.blogspot.com, www.dutips.blogspot.com or www.naultfhatips.blogspot.com
You Have a Responsibility!
The federal government is once again getting involved in the mortgage lending sector. They haven't done well in the past when this has happened. They create regulation to help the consumer that has been so far over the consumers head that it confuses everyone.
There are many who believe that the reason the mortgage industry is in the current mess is because of the mandates that were imposed on the industry by congress to increase homeownership. (Here is one article and if you want all the detail go here and there are many, Google them) There is regulation already in place that should have prevented the mortgage melt down if the government had not imposed additional requirements that made banks lend to borrowers who were not credit worthy or could not afford their mortgage loan.
I have been in the mortgage business for over 20 years and I have also seen the greed that added to the problem. But... none of this could have happened if the consumer had taken responsibility for their own best interest.
I designed this blog to help educate anyone that is looking for a mortgage loan. This will help you decide if you really are ready for home ownership or to refinance your home. You will understand what type of loan you are getting and if it is best for you. Do not depend on the government, your loan officer, or anyone to tell you if you can afford a home until you have done your home work.
Remember do not sign anything you do not understand!
Shirley Nault has been a mortgage professional for over 20 years in the mortgage industry. Many of these years she has been a mortgage underwriter/manager. You can visit her other web sites at www.mtgview.blogspot.com, http://www.dutips.blogspot.com/ or http://www.naultfhatips.blogspot.com/
There are many who believe that the reason the mortgage industry is in the current mess is because of the mandates that were imposed on the industry by congress to increase homeownership. (Here is one article and if you want all the detail go here and there are many, Google them) There is regulation already in place that should have prevented the mortgage melt down if the government had not imposed additional requirements that made banks lend to borrowers who were not credit worthy or could not afford their mortgage loan.
I have been in the mortgage business for over 20 years and I have also seen the greed that added to the problem. But... none of this could have happened if the consumer had taken responsibility for their own best interest.
I designed this blog to help educate anyone that is looking for a mortgage loan. This will help you decide if you really are ready for home ownership or to refinance your home. You will understand what type of loan you are getting and if it is best for you. Do not depend on the government, your loan officer, or anyone to tell you if you can afford a home until you have done your home work.
Remember do not sign anything you do not understand!
Shirley Nault has been a mortgage professional for over 20 years in the mortgage industry. Many of these years she has been a mortgage underwriter/manager. You can visit her other web sites at www.mtgview.blogspot.com, http://www.dutips.blogspot.com/ or http://www.naultfhatips.blogspot.com/
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