Saturday, December 14, 2013 - Article by: George DeVine - Atlantic Home Loans -
The most important thing to consider when purchasing a home is how much you can afford to pay every month. Much too often, I've spoken with a potential home buyer who tells me that they are comfortable increasing their current housing expense by several hundred dollars, but when I review their financials, they have little or no money in savings. It begs the question; if you're paying $1,500 per month in rent and cannot put any money into a savings account, then how are you going to increase your housing expense to $1,800 per month when purchasing a home? And this doesn't even factor in the added maintenance and utility expenses associated with owning a home! The best advise that I can give is a two step process. First, lay out a detailed budget and arrive at a realistic monthly housing expense. Secondly, if that amount is more than what you currently pay, then begin taking that difference and set it aside in a savings account. This way, you will get used to paying that amount every month before you purchase a home. For example, if you rent is currently $1,500 per month and you would like to purchase a home with a monthly housing payment of $1,800 then start putting $300 into savings every month. You might consider adding $100 to that number to include repairs and maintenance. Send me an email at firstname.lastname@example.org and I'll send you an easy to use budget template.
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