Property Buyer’s Tips

Getting started

Before you start looking for a home you should ask yourself a few questions.

Here are a few tips to help you get organized:

How much house can you afford?

Simply put, you can afford a house that costs as much as the largest monthly mortgage payment you qualify for.

A quick way to estimate the size of mortgage you qualify for is to take your gross monthly income (that's before taxes and other deductions) and multiply it by .28. This works out to just over 1/4 of your gross income.

Mortgage companies use something called qualiying ratios to determine how much they'll lend you. Most mortgage companies use either a 28/36 ratio or a 25/33 ratio. The first number in each pair is the percentage of your gross income that the lender would consider acceptable as a monthly mortgage payment (i.e. if you make $3,000 per month, 28% of that is $840 per month).

The second number in each pair is used when all debt payments are considered, not just the mortgage. (i.e. if you make $3,000 per month, but also have a $250 a month car payment, 36% of $3,000 is $1,080, minus the $250 car payment equals $830).

As you can see, in this example the numbers work out to be almost the same. Obviously if you have more debt you would qualify for less.

Why you should work with a realtor

Working with a professional real estate agent to buy your home is a good idea for several reasons:

Choosing a real estate agent

Searching for your dream home can be a time consuming experience. Working with a professional real estate agent will make the process much more efficient.

Since most people spend a fair amount of time with their real estate agent, it's important to choose a real estate agentyou feel comfortable with, and one who is responsive to your needs. The following questions will help you decide if a particular Realtor is right for you:

If you find yourself answering "no" to many of these questions, or to any individual questions that are important to you, you should keep looking until you find a real estate agent you feel comfortable with.

Merrill and Associates Real Estate
2004 Dallons Drive
Paso Robles, CA 93446
Email:
kristina@kristinawesley.com
Phone:
805-423-8676
Prudential
Realtor MLS Equal housing
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