Buying a Home

Home Buying Process in a Nutshell

How Much Can You Afford?
Your first step is to determine how much you can afford. The easiest way to do this is to take your income minus your expenses. Then take what you have available for a monthly payment and determine how much you’re willing to use towards a mortgage payment. After you determine this amount try our Loan Calculator.

Loan Calculator
You can either use this one from Prime Mortgage or do a Search on Google or contact Mark Hesser he can help you determine your price range and also get you pre-approved for a loan, which would be your next step.

Pre-Approval
What you can afford and what you’re pre-approved for are two different things. Do not buy a home based on what you’re pre-approved for, some times this can be more than you can afford. Instead use the amount you can afford as your ceiling price and search based on that.

Home Search
Now that you’ve determined what you can afford it’s time to do some searching. You’re more than welcome to use my site, but I would recommend contacting me and I can set up a customized search that will give you better results than what most sites are capable of. I don’t mind creating these searches for you, but at some point we should get together and talk more.

Viewing Properties
What ever you decide to use to search pick out some homes you’re interested in. You can either drive by these first and determine if you want to get a closer look or you can contact me and I’ll show the home(s) to you.

Making an Offer
When you find a home you would like to purchase I’ll work with you to make an offer on the place and negotiate on your befalf until we reach an aggrement with the seller.

Pre-Closing
I would at least recommend an inspection on the home. This makes sure there are no problems with the home before we close. The other piece is the apprisal. The appriser is protecting the bank by loaning you money to purchase the house. After these two items have been completed it’s on to closing.

Closing
There’s really not much else to do here. You may need to bring funds with you, but that will be determined by the Closing Agent.

How much home can you afford?

Your first step is to determine how much you can afford. The easiest way to do this is to take your income minus your expenses. Then take what you have available for a monthly payment and determine how much you’re willing to use towards a mortgage payment.

Determine Your Take Home Pay

If you already know your take home pay you’re half way there and can jump to the expenses portion of this post.

There are a few ways to figure out your monthly income if you don’t already know your take home pay. (After Taxes, Health and other deductions have been taken out.)

Your Checking Account – Take a look at your ledger and see what your deposits have been for the month and take a look at the last few months to double check how much your work related deposits have been. This would be your take home pay, which is the number you need to help determine how much home you can afford.
Salary – If you only know your yearly salary divide that number by twelve. After you have your monthly number divide that by three and that is about how much is taken out of your check, give or take depending on what you have for pretax deductions. The other two-thirds is your take home pay.
Hourly – There are approximatly 173 working hours in a month. Take your wage multiplied by 173 and that is your monthly income. Take your monthly income and divide by three and that is about how much is taken out of your check give or take depending on what you have for pretax deductions. The other two-thirds is your take home pay.

Monthly Expenses

If you already know your expense you’re just about done and have also made a budget.

Living Expenses – Living expenses for a home your own are typically higher than a home your would rent. The typical living expenses for a home include heat, water, electricity, trash, phone service and tv service.
Household Expenses - You should also consider how much you spend on clothing, car expenses - insurance and repairs, food, entertainment and anything else you purchase on a regular basis.
Loans – School, Car anything else you may have out there.

What is your monthly payment

Cash Flow – This is your Take Home Pay minus your Expenses. From this number you should determine how much cash you would like left over after you make the mortgage payment. Once you decide how much cushion you want you now have your monthly payment. From here try this loan calculator to figure out the amount of home you can afford. Click Here.