Owning your first home is probably one of the most exciting things you can do. Working toward home ownership however, is hard work. Qualifying for a loan in and of itself, in this economy is probably one of the hardest things to do. So what are the steps toward home ownership and is it worth the effort?
Step 1: Determine Affordability
The first thing you have to do before even being pre-qualified to buy is to determine what you can afford to pay. There are several loan officers out there that can get you pre-qualified for a home that is way over your budget so it's important to sit down with a financial consultant or mortgage broker so you can weigh your current debt against your income and savings. Things such as how much you can use as a down payment, closing costs, and other expenses will all come into play when working toward home ownership. Generally speaking, lenders are looking for a down payment of at least five to twenty percent of the purchase price.
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