4 COMMON MISCONCEPTIONS ABOUT BUYING A HOME

4 COMMON MISCONCEPTIONS ABOUT BUYING A HOME

4 Common Misconceptions About Buying a Home - Though most Americans say they’d like to own their own home one day, there are a number of misconceptions about the buying process and current market that cause many to believe they won’t be able to get financing or can’t afford homeownership.

According to a recent article from Christina Boyle, Freddie Mac’s vice president and head of single-family sales and relationship management, not being able to come up with a 20 percent down payment is the top myth keeping Americans from entering the market.

Boyle says, though a lender may ask for 20 percent down, it isn’t always a necessity and, in general, you should expect to have a down payment of about 5 or 10 percent. Another common assumption is that you’ll need a perfect credit score in order to get a mortgage. While you’ll definitely have more options with a higher credit score, your score doesn’t need to be perfect to secure a loan. Boyle also points to recent increases in mortgage rates and the belief that homeownership is too expensive as reasons potential home buyers stay on the sidelines.

But despite recent rate increases, mortgage rates are still well below historical norms and, according to recent research, owning a home is actually cheaper than renting in the 100 largest metropolitan areas across the country.

For more tips and Real Estate advise, reach out to me at 317-496-6291 or email me at lora@indyhomesrealtygroup.com.

TIPS FOR GETTING A MORTGAGE

TIPS FOR GETTING A MORTGAGE

TIPS FOR GETTING A MORTGAGE - Are  you considering buying a property as a second home or investment? Perhaps you are looking for a small cottage or apartment where you can escape for vacation, or maybe you want to have another home closer to family. Maybe you want to rent out your second property and make a steady income from your investment. Whatever the reason, a second piece of real estate can be a fantastic investment. However, sometimes getting a mortgage on your second home can be a challenge.

Generally, a mortgage lender will have tougher standards for second home loans than primary home loans. This is because usually when you are buying a second home your finances will be stretched thinner and you will have less money to spare because you are already paying a mortgage on your primary home. This will mean that your second home mortgage can be harder to get and might have a higher interest rate.

Here are some tips to keep in mind that will help you to get the best mortgage on your second property: 

Build up a decent amount of savings. Your mortgage lender will want to be able to see that you have a large amount of savings so that you will have enough to pay for the mortgage even if you were to lose your job.

Pay off any credit card debt. Many lenders will be hesitant to approve your second home mortgage if they see that you have a lot of debt on your credit card. They will want to see that you have a low debt to income ratio so that you will be able to pay back the loan.

Use the first mortgage as a good reference. If you have always made your payments on time and you are most of the way through paying off your first house, you could ask someone from your current mortgage company to vouch for you. The lender for your second mortgage will be reassured that you are a reliable person to loan money to.

These are just a few tips to keep in mind in order to make getting a mortgage for your second property as easy as possible. To find out more about investing in Indiana property, contact me at lora@indyhomesrealtygroup.com or 317-496-6291