I wanted to share a few points with you from an e-mail I recieved today. It focus's on all home buyers, but mostly applies to first time home buyers.
Keep in mind these are just suggestions, and everyones financial situation is different.
How do you know what you can afford?
Tip-Don't spend more than 35% of your pre-tax income on the combination of your mortgage, taxes and insurance. If the neighborhood has an HOA, you can add that in as well. For example, if you make 50K per year, 35% is $17,500. When you divide $17,500 by 12 months you come up with $1,458.3 per month.
Look into the future:
When your buying a house, you are generally planning on living in it for minimum of 5 years. You don't want to buy something you know, you are going to grow out of in one year. Therefore, you may need to look into the future, and see where you envision yourself.
If you are a couple, here are a few ways to look at things:
..................Both spouses working full time.
..................One working part time, and the other full time.
..................One working full time, and the other not working.
Also, keep in mind there are always the unknowns you may need to prepare for!!!!
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