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Did You Know?

To determine how much you can afford, you need to have a good picture of how much you're earning and then prioritize your expenses accordingly.

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Step 1: How much can you afford?
Step 2: Know your homebuyer rights
How Much Can You Afford?

Owning a home is the American Dream. It’s a great way to create wealth and pass it on to your family, build a nest egg for college or retirement, and protect against life’s setbacks. It starts with being smart about money. What you can afford depends on your income, credit rating, current monthly expenses, down payment and the interest rate.

Affordable FHA Loans

To determine how much you can afford, you first need to know your monthly income. Second, you will need to calculate your monthly expenses which may include credit card bills, car payments, insurance premiums, and all other debts. The U.S. Department of Housing and Urban Development’s (HUD) “Determining What You Can Afford Worksheet" will help you calculate your income and expenses to help determine what you can afford. HUD wants all Americans to manage their money and have the option of preparing for homeownership.

Get Organized

Set a goal to save a certain amount of money each month and stick to it. Set money goals and develop a plan to reach them. Decide what’s important to spend, then save the rest for a rainy day. This is how you can build a nest egg for a down payment on a home.

Watch Spending and Savings

Prioritize your family’s spending needs so that saving becomes second nature. Putting a little money aside every month takes hard work and requires someone to make difficult choices. But the rewards can be great. Learn about the power of compound interest. Teach your children that a few hundred dollars invested now can turn into thousands of dollars over time.

Be Prepared to Negotiate

Communicate early and often with companies or banks you owe money to so you can work out problems before they grow larger. Many consumers, including homeowners, feel trapped by debt. But there may be other options. Contact the people you owe. They may be willing to work with you to develop new payment plans. It will show that you are serious and smart about money.

Elevate Your Credit Score

Know your credit score and what it means to banks and lenders. The importance of good credit is a fact of life. Banks, lenders, andcredit card companies decide whether to lend you money and what interest rates you will pay based on your credit score. Be prepared to examine past choices and, if necessary, to change your money habits. Decisions you make today will impact your future options.

Read and Understand the Fine Print

Know your rights. Homebuyers should understand their mortgage contract and be on the look-out for scam artists and predatory lenders. Consider all the options, educate yourself, and be informed before you sign on the dotted line. Consumers have more ways than ever to buy a home. A HUD-approved housing counselor (1-800-569-4287) can help.

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When buying a home, it's never a good idea to spend more than you can reasonably afford. Start saving up early for a down payment and always have a reserve.
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FHA Loan Articles

Down Payments for FHA Loans

One of the major hurdles that keeps families from purchasing a home is the need for a down payment.  The FHA’s goal is to offer more homebuying opportunities to low- and moderate-income Americans and set more easily achievable down payment requirements for borrowers. 

What Affects a Home Loan Applicant's Credit the Most?

A home loan is one of the most important investments you can make. Buying a home means owning property, and being a homeowner means there's potential to watch your investment grow in value over time.  But first, the lender has to make sure the borrower is a good credit risk.

How Much Do I Need to Put Down on a House

A down payment is an upfront installment or part of a larger amount paid on a purchase. The remainder is paid off in separate installments, usually with interest, as part of a loan. The down payment represents your initial ownership stake in the home you continue to make payments on.


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