Home Owner Tax Credit

See if You are Financially Ready for a Mortgage

Are you thinking of purchasing your first home? Before you start dreaming of white picket fences and planting roses in a yard, ask yourself: Are you financially ready to get a housing loan? If you’re not sure about the answer to this question, here are some things you ought to consider.

Things to Consider Before You Purchase a Property

1. Expenses and Savings
Most people can get loans for up to 90% of the purchase price. But don’t think that just because you have the money for the down payment, you can afford to pay off a loan.
So, check your balance sheets and do some accounting. Do your monthly expenses leave a lot to spare? Or is your budget tight? If you have a lot of other loans, credit card bills and other things to pay off, this might not be a good time to get a mortgage.

2. The 30% Rule
Lenders usually give loans to people whose housing payments don’t amount to more than 30% of their gross monthly income.

If you think you’ve got these two things covered, then congratulations! You can get yourself a housing loan and be on your way to being a home owner! If your finances leave much to be desired, though, it’s best to wait and save up a bit more.

Good luck!