If you dream about owning your first home, you’re not alone. The thought of plenty of space, room to plant flowers and the ability to park your car in your own garage is alluring. But, how do you know when you’re ready to take the plunge?
Is it a good time to buy a property? For many reasons it is a great time to buy. First, interest rates are still low, home prices are obviously low so all in all there probably has not been a better time to think about buying.
FHA loans are federally insured mortgages targeted toward increasing model homes for people with moderate incomes. In the Chicago area you can get a mortgage up to the limit of $275,200 (Higher for a 2-4 flat). Because this is typically a 3% down payment loan, this means a purchase price of around $280,000. This figure changes every year, and many experts expect that the limit will be raised considerably in order to make up for the loss of so many other financing options.
You’ll have to answer many questions during the application process of an FHA loan. It’s a good idea to keep all relevant information close at hand when applying for an FHA loan so that you can hand in everything all at once.
It would be wise to get counsel from your company about your specific financial situation before making a decision to borrow from your retirement funds.
You need to be specific and set concrete goals so that you can put a plan together to reach them and then have something to track your progress. Instead of just saying you’re going to start building an emergency fund, be specific and say you’re going to set aside $10,000 in 12 months. Ok, now that you have a specific goal set you can start putting a plan in place to reach that goal. You know exactly how much you need to set aside each month to reach that goal ($833) so every month you can track your progress. If you fall short, you’ll know and can then think about ways to make up the difference.
Before you agree to enter a debt settlement, learn about what happens to your credit as a result of it. Some settlement agreements can actually be bad for your credit score, so be wary and do your homework. Some creditors have no concern over how your credit score can be affected by entering into certain agreements. These people just want your money.
I’d argue that if you’re stretched to the point where you have zero savings left over to take care of unforeseen expenses after purchasing your home, you risk a lot of unnecessary stress, losing your house or having it fall into disrepair.
A home equity loan is a second mortgage. It usually has a fixed interest rate and fixed time frame. The interest you pay is normally tax deductible and there is no penalty for paying off the loan early.
Now, let’s see how Lisa is doing. Lisa has only $33,793 in equity built up BUT she has $17,599 in savings! She will be able to make her monthly mortgage payment with ease, even with no job. In fact, she has enough money saved to make her monthly mortgage payment for 8 months! No worries here!
Saving money on your federal taxes is just another reason for you to consider home ownership. You can literally save thousands of dollars per year (or hundreds every month) by using the 5 tax strategies outlined above!