When you are planning to buy a home, and perhaps acquire a mortgage, what are some of the key considerations that should go into the decision-making process?
Some advice from Warren Goldberg, President of Mortgage Wealth Advisors in New York…
For most Americans, homeownership is the American Dream and has provided the cornerstone to building wealth. Yet countless Americans shop for a home and then a mortgage without considering many critical factors. These factors can mean the difference between enjoying your home while building long-term wealth versus financial disaster.
#5 – Owning vs. Renting – While owning a home will help you build wealth over the long-term, homeownership is not always the right choice. Buying a home usually requires more upfront capital, more ongoing expenses, and a longer-term commitment. If you foresee your place of residence changing within the next three years or so, the costs of buying and selling a home could outweigh the equity you’ve accumulated.
#4 – Be Realistic About Your Budget – Regardless of what you may qualify for, considering your lifestyle and budget, how much do you feel you can comfortably carry every month? Everyone lives a different lifestyle. Some people unfortunately have more fixed expenses than others. These should all factor into you budgetary decision on a housing payment.
In addition, consider other factors such as saving for retirement, funding college for your children, and potentially caring for elderly parents or other ailing family members. Don’t forget about utilities, costs for improvements, and ongoing maintenance expenses.
#3 – Home Shopping Before Getting a Solid Mortgage Approval – Once you’ve created your budget and you’re confident you can carry that mortgage payment, are you certain you will qualify for a mortgage?? While YOU may think you’re perfectly qualified, lenders must follow strict guidelines regarding how you derive income, where your down payment comes from, and what your credit history looks like.
Low housing inventory in many markets means you’ll be competing with multiple offers once you find a home. Obtaining a Pre-Approval before you start shopping makes you a stronger buyer than many of your competitors. This combined with our Proven and Unique Negotiating System, the likelihood of you getting the accepted offer just multiplied significantly. Contact me and let me show you how we can position you to be “The Best Buyer” for any given seller.
#2 – Shopping for “Wants” vs. “Needs” – Shopping for a home is an emotional rollercoaster. You’re comparing neighborhoods, home styles, and the “look and feel” of the block. While you may fall in love with a house because of the inviting front porch or the beautiful backyard, is the house layout conducive to your family’s needs? Is there enough living space – or too much? Are you comfortable having the Master Bedroom on the second floor, while the nursery is downstairs? Before going out shopping, make a list of the traits a house must have. These are the “needs” that are not negotiable. The “wants” such as the front porch and white picket fence should be considered added bonuses.
The Number One Factor – and probably the most critical one – many don’t even realize should be considered! This One Factor could be the difference between the extremes of fiscal landmines, hidden expenses, and financial disaster, compared to enjoying your home and building wealth over time. What is this all-important factor? You’ll have to contact me to find out.
Warren Goldberg is the President of Mortgage Wealth Advisors, Inc., a Certified Mortgage Planning Specialist®, and a published author. His interviews and presentations include Blog-Talk Radio, Newsday, the Daily News, the Long Island Herald, and even the Nassau County Bar Association. His mortgage Industry newsletter is published bi-weekly and is read by thousands of subscribers.Google+