Tuesday, April 5, 2011

It's NOT All About the Benjamin's, Baby

Hi! Nick here, with a few tips to remember before and after the home buying process. Buying your first home together can be a very exciting time, but it can also be a time where mistakes are made that can become road blocks to your dream home. When the two of you sit down after the wedding and start to open all those little envelopes filled with moolah, you usually start to think about all the fancy presents you want to buy for yourselves. Well, if you plan on buying the fanciest present of them all, a house...then you better put dreams of financing a new car on hold until after you close on the new digs. When you go to apply for that mortgage and a bank sees a brand new BMW on the credit report, they are going to slam the door right in your face. Yes, a car loan is considered a normal type of debt, but they like to see that it's debt that you've been paying down for a couple years. If you can hold off on the new Roadster for just a bit longer, you'll be all the better for it. In a nutshell: hold off on those big-ticket items until after moving day.

One of the most common situations I find myself in with newlyweds who are first-time buyers is, they tend to look in price ranges that might be a a little over their heads. You don't want to be caught in that "I told you so" moment with your real estate agent. The way to avoid that is to get pre-approved for a loan before you look for a house. You can break out the calculator yourself and add up your Benjamin's, but you'll find out soon that it's not all about those. The bank might disagree with you when it comes to your buying power. The moral of this story is: don't fall for a over-priced property to find out that you can't afford it. It's much more comforting to look for a house in the best, and most comfortable price range for you.

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