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Criteria for buying a house

Criteria for buying a house. Most important pre-requisite. You MUST determine how much home you can afford each month. How do you figure that out? Most DTIs need to be under 41% for total and 30% for housing expense.

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Criteria for buying a house

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  1. Criteria for buying a house

  2. Most important pre-requisite • You MUST determine how much home you can afford each month. • How do you figure that out? • Most DTIs need to be under 41% for total and 30% for housing expense. • Figure out average tax rates in the area your looking and estimate tax payment. EX: http://www.pcpao.org/ • Call for some homeowner’s estimates • Get Pre-APPROVED for a mortgage at a payment you’re comfortable with

  3. Determine the area you want to live in. • Is price a factor? • Are school districts? • Crime rates? • Sexual Offenders? • Activities? • Shopping? • Airport? • Entertainment? • Sports? • Etc.

  4. Initial Property Criteria • How many beds/baths? • Sq. Ft? • Type of Flooring? • Appliances? • Color? • Rehab level? • Room layout? • Bathroom type? • Pool? • Etc.

  5. Are you in reality? • Compare the lists of property criteria / area criteria with the price you can afford. • Can you find what you’re looking for where you’re looking for it at the price you need? • If not, what criteria is more important to you? Is it location or type of house? • What’s the compromise?

  6. Exercise – Complete in notebooks • Create lists of area criteria and property criteria. • Use this website to help determine how much home you can afford: http://www.bankrate.com/calculators/mortgages/new-house-calculator.aspx • Use the following amounts • Monthly wages: $7500 • Down Payment: $7500 • Loan term: 30 years • Interest Rate: 6% • HOI: $3,000 • Taxes: $6,000 • Car Payment: $400 • Other Debt: $100 • All the rest: $0 • How much house can you afford?

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