Time to Buy a Home?

clip art courtesy of fotosearch.com

If you've been thinking about taking the plunge and buying a home, this just might be your opportunity. In many areas of the country, such as the Scottsdale real estate market, there are more houses available than there are buyers, making this a buyer's market where sellers, desperate to sell their homes, are willing to make concessions they would not consider in a seller's market.

The recently lowered interest rates are also enticing to potential buyers, but lenders have tightened their guidelines in an attempt to cut down on their risk of customers defaulting on their loans, making it more difficult for wannabe buyers to qualify for a loan.

If you are thinking about purchasing a home, here are some steps you should take now:

• look at your credit report to see what is in it so that you can correct any mistakes before going to a lender.
• determine what you can realistically afford to pay each month. (Don't forget that figure should include a monthly escrow for taxes and insurance.) The bank may be willing to loan you more money than you feel you can afford. Don't accept the extra money; living within your means is one way to avoid financial difficulties, which could include foreclosure.
  
• determine how much you can put down on a house. There are programs to help first-time home buyers acquire a home using very little of their own money, but there are normally extra fees attached which will raise the monthly payment.
  
• research the different mortgage types available: ARM, fixed, no interest, balloon.

Homeowner is an exciting status to achieve, but be smart and don't create trouble for you and your family.