DebtSmart.com Friday, April 19, 2024

What should buyers be prepared for when applying for a loan?

by Scott Bilker
Scott Bilker Scott Bilker is the founder of DebtSmart.com and author of the best-selling books, Talk Your Way Out of Credit Card DebtCredit Card and Debt Management, and How to be more Credit Card and Debt Smart. Receive the 5-Year Loan Spreadsheet when you subscribe to his email newsletter.

I am quoted in Trulia’s Mortgage 101 round up! Check out my advice to first-time homebuyers, and other common questions explained.

What should buyers be prepared for when applying for a loan?

“There are a few things to get squared away before applying for a loan:

1. Cash for a down payment.
Save money/acquire money for a down payment and closing costs.

2. A good working knowledge of your personal finances.
Create a budget of your future expenses, as if you own the house, and make sure you can afford it. A good rule of thumb is that your mortgage should not exceed 30% of your take-home income.

3. A general idea of the price range of homes you are interested in.
Research potential homes through a local Realtor or at Trulia.com. Compare by looking at real estate taxes, neighborhood statistics, and other criteria. Take your time! Your house may be the largest purchase in your life.”