Buying a Townhouse You Can Afford in White Bear Lake, MN

Real Estate Agent

If you’re looking for the perfect townhouse in White Bear Lake, MN, you no doubt have a list – physical or mental – of all the things you’re looking for in your new home. But have you made a list of steps to take to ensure that you find a townhouse that you can really afford? This article gives seven helpful steps to get you down the path to responsible home ownership:

#1 – Get your credit in as good shape as possible
Many people have no idea what their credit score is, and while you don’t want to check it constantly (checking very often can also look bad on your credit report), you should know what your numbers are and whether there are any errors. But the most important thing that you can do to get your credit in good shape is to pay down your debt, starting with your high-interest debt and leaving the low-interest stuff for last.

#2 – Be ready with your down payment
There are good tips here on how much you should put down on a house vs. saving. 20% is an ideal amount, but if you can’t afford it, you should weigh the pros and cons of taking out another loan to cover the difference vs, borrowing against IRAs.

#3 – Try to pick a mortgage with a fixed rate for the longest time that you think you’ll be keeping the home
Fixed rate mortgages have higher interest rates than ARMs, but they’re exactly that – fixed. You don’t have to worry about your rates increasing in the future. If you think you want to be in your new home for at least five years, a fixed rate is probably the way to go. If not, an ARM may work in your favor.

#4 – Choose the right loan term for your needs
If you can afford to do a 15-year loan, you’ll save money in the long run. Many people choose a 30-year loan because it provides short-term savings on mortgage payment. Only you can decide which will work best for you.

#5 – Shop around for a mortgage
Definitely find as many options as you can for a lending company! There are sometimes deals to be had for first-time home buyers, buyers willing to move into certain areas, etc. Weigh all of your options, and check out the calculator mentioned to compared them.

#6 – Figure out how much home you can afford
Just because a mortgage company will lend you $500K doesn’t mean you can actually afford a $500K home. Do a detailed analysis of all the expenses that you will conceivably incur as a homeowner, put it all down on paper, and figure out what you can really afford for a mortgage payment.

#7 – Start house hunting
Find a realtor with lots of experience finding homes in White Bear Lake, like us! We’re ready to get started helping you find the perfect White Bear Lake, Minnesota townhouse that you can really afford!

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