Buyer Be Saving

As one views all the advice on the Internet, television, radio and print media, it becomes obvious to a potential new home buyer that credit, credit scores in particular, are hugely important in the purchasing of Real Estate. Know your credit file. Address any errors and have inaccurate data removed prior to applying for your mortgage. Speak with a mortgage professional that can help you to manipulate the data within your file to get you the best credit score possible. Increase credit lines without using them. Etc, etc, etc. Pointers are endless. Some good, some not so good.

Seems that one reads very little about the single most important resource needed when buying a home. Something not many of us have too much of. Something that creative marketing over the last several years had lead us to believe that we really didn't need to buy a home. It's the reason most of us go to work 5-7 days a week for 35 - 70+ hours per week. It feeds us, fuels us, entertains us and allows us to obtain what ever it is that we need or want in life. It comes in many forms and has been called many things. Doe - Rae - Me, Scratch, Cake, Moola, Jing, Bacon, Coin to name a few. You guessed it! The all mighty dollar.

When I initially entered the wonderful business of mortgage lending the only product on the market which allowed for no cash investment in down payments and / or closing costs was a VA loan. All closing costs could be paid by the seller as agreed to in the sales agreement. Always respected the fact that our government takes such good care of those that have made sacrifices for the freedom of our great nation with a benefit like that. The lowest down payment program available to non-service people was an FHA loan at 2.5% down. As always, allowing 6% seller assist and all funds needed to close can be gifted from a relative. Outside of those programs, a new home buyer needed 5% down (minimally) and the seller could contribute up to 3%. Over the years oh how times have changed. Nearly anyone could get 100% financing with 6% assistance from the seller. But as with fashion, sports, politics, and many other things in our lives, the more things change, the more they stay the same.....

Ladies and Gentleman, Men and Women, Boys and Girls, it takes money to buy a house. Home Ownership is not, I repeat is NOT an impulse buy for the majority of Americans. Unless your name is Tiger Woods, Oprah Winfrey, Donald Trump, Warren Buffet, or some similar name with endlessly deep pockets, there needs to be a plan in place to ensure that a sufficient amount of cash is in fact available to use toward the purchase of your home. In fact, many times excess cash is necessary for what the industry terms 'reserves'. Cash left over after the transaction is completed. Reserves are nice to have for not only emergencies like an unexpected home repair, loss of income, unforeseen medical emergency, etc.  They are also important for those little odds and ends that end up totaling a tidy sum once you move into your new home. Storage, Movers, ccurtains, rods, blinds, throw rugs, garbage cans, pictures, bathroom and kitchen items, lawn maintenance supplies, etc, etc, etc...... Things we don't often consider can add up to a pretty penny. It's terrible to find yourself void of funds when you take ownership of your new home because you spent every dime you had to get into it. A true recipe for disaster.

Keeping cash in mind, as a potential home buyer, your consideration must be heavily weighed upon your liquid cash assets available to complete the transaction. Available cash can include IRS tax refunds, the sale of an automobile or other verifiable asset for cash, savings, checking, stocks & bonds, mutual funds, etc... Some retirement accounts or 401k's will allow you to liquidate, or borrow against them for the purchase of a property. You'll need to check the plan description to determine if in fact you can use that as a source for funds. Additionally, gifted funds from family members may be eligible to be used, depending on the loan program you select. This stuff can make your head spin......

All things considered, your best bet is to meet with a Mortgage Consultant prior to beginning your search for your new home. Qualifying for a Mortgage is certainly more than what maximum monthly payment you can get your loan approved for. Much more in fact. A true Mortgage Professional will work with you to help you to achieve exactly what it is your looking for in financing a new home. They will also help you to implement a short or long term plan to get you there in the event NOW is not the time. It's true on occasion that 'good thing's come to those who wait'. But better things happen to those who plan. If you believe NOW is the time, run, don't walk to a mortgage professional near you to help you make it happen!

My name is Scott Geary and I am a Mortgage Professional in THE Lehigh Valley, Allentown  Pennsylvania.