Can you afford this home??

Buying a home is not as simple as picking a home and getting a loan. Here is a brief list designed to help you avoid pitfalls in regards to financing a home purchase:

1. You need to determine if you can truly afford the purchase. Find out before you sign a purchase contract what your monthly cost is going to be including loan payment, taxes, common charges, association due, and estimated utilities.

2. Get a Good Faith Estimate from your loan officer prior to signing a contract to purchase a home.

3. Get a preliminary Truth in Lending sheet showing the estimated payment schedule for your loan. You may be surprised to see that a few years down the line your payments are expected to jump dramatically.

4. Realize that if a loan program seems to good to be true, it probably is......

5. Pay attention to how responsive your mortgage broker is in returning your calls/emails, following up on pending items, and explaining the details of the loan product & pricing that you are considering. Look to see to what extent they deliver on any promises they make early on. Whatever early experience you have with them, bad or good, is likely to be reflective of how the entire transaction proceeds.

6. Most importantly, talk to trusted independent financial advisors about what you can afford after choosing a loan product but before signing a real estate purchase contract. Your attorney is generally not the one you should rely on for financial advice, and most will not offer it. You want to talk to a reputable CPA, financial analyst, perhaps a family member that is excellent with budgeting and finance.