So you’re ready to take the plunge. Grow up. Sign your name on the dotted line. Buying your first home is exhilarating and scary. Here are a few tips from our experts at Wohland Mortgage Team to give you some confidence with your first home purchase.

Check Out the Comps

The National Association of Realtors has a website with a multiple listing service (otherwise known as MLS) that includes homes for sale in your area, the amenities of the property and asking price. Bankrate has a mortgage calculator so you can get an idea of what your monthly mortgage payment would be if you bought the home today.

But Wait, There’s More

The mortgage payment is the first step. You also need to add in what you’ll pay for your taxes and insurance escrow. In some cases, it can almost double your out-of-pocket monthly costs. Find a property that is similar to one you would want to buy, and ask an insurance agent what the cost would be for a policy. As to taxes, often the MLS listing will give you an idea of what to expect.

The Closer

Remember there is another big ticket item: the closing costs. There are origination fees charged by the lender, title and settlement fees, taxes and sometimes homeowners association fees. You’ll want to add this into your budget so you don’t have any surprises on closing day.

Be Wise, Not House Poor

It’s conventional wisdom that you shouldn’t spend more than 28 percent of your monthly income on housing. You want to enjoy your home, and have the income to enjoy your life outside of it as well. Real estate in Arizona has had large swings both up and down. Talk with a realtor to get a feel for the market and see how your investment fits into your budget. Buying a home can be a great investment and wealth-builder, but be ready for the costs of maintaining your investment with unexpected costs for new appliances or plumbing repairs. You are the landlord now, so be ready to shoulder the costs should they arise.

Look Carefully at the Numbers

One of the first steps to becoming a homeowner is taking a fresh look at your credit score. If you have a less-than-stellar FICO score, and can’t make a substantial down payment on a home, you will have a rougher road to getting approved for a loan. You can get a free annual credit report. Check it out and if there are any errors on it, correct them before you start the house hunting process.

What’s Up, Doc?

A lender is going to want to see your financial history, so better to gather the info now, before you find the house of your dreams. W-2’s, bank account statements, pay stubs and the name and addresses of your landlords for the past couple of years will go a long way to answering financial questions. When you are preapproved for a mortgage, you can bargain from a position of strength when house hunting. Call us at Wohland Mortgage Team for advice on taking the plunge to buying your first home.

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