If you are preparing to buy a new Lakeland Fl home, now is the best time to buy. With historically low 30-year fixed interest rates of 3-4%, buying a home now would be an excellent decision.
Homes are also at their most affordable at present since Lakeland Fl home values have dropped as well as homes all across the US. The market has a huge supply of short sales and foreclosures selling for bargain prices.
All these great deals may get you scrambling to write that check for that Lakeland Fl home, but one important rule you should remember is buy within your means. Just because you have been approved for a certain loan amount does not necessarily mean you should spend that amount.
So the question is, how much can you really afford on your Lakeland Fl home? Here are some things you should consider before buying a home:
1. How much do your earn monthly?
If you have a regular job with a fixed salary, it would be as easy to calculate your monthly income by just collecting your pay stubs. If you are working on a commission or tip basis, then you should factor in your high and low income months.
2. How much are you monthly expenses?
Your monthly expenses is different from your monthly debts. Your monthly expenses will include but are not limited to: food, water, gas, cellphone, cable, internet, clothes, entertainment, travel, etc.
3. How much is your monthly debt?
How much do you spend each month on credit cards, car loans, student loans, child care, alimony, and other debts?
4. Do you have a stable job?
With today’s unstable job market, how sure and stable is your job? In the unfortunate instance that you lose your job, will you still be able to make your monthly mortgage payments?
5. How much savings do you have?
If you plan to take out a loan, lenders will ask you to put down at least 20% down along with the closing costs. If you are buying a $200,000 house, then you need a $40,000 down payment. Do you have this amount on top of your emergency fund? If not, then consider a buying a less expensive home that wouldn’t break the bank. Consider a less expensive house or simply wait a little bit longer to buy.
After answering these questions, you will be able to carefully assess yourself and your ability to afford that Lakeland Fl home you want to buy.