Throughout your life, you’ll make any number of purchases. One of the biggest – more likely than not – will be a house. In the home buying process, there are numerous steps. One of the most crucial is figuring out what you can realistically afford. That doesn’t have to be as mind-boggling as it may seem at first. It’s also not as time-consuming as you might think and is, in fact, relatively straightforward. This is especially true when you use the Builders Showcase Mortgage Calculator.
Let’s take a look at some of the numbers involved in the process of figuring out what you can afford.
Figuring Out a Budget When Building a New Home
First of all, will you be entering into this venture alone or with a partner/co-borrower/spouse/parent etc.? For each of you, write down how much you earn every month. Besides your salary, numbers will include rental earnings, investment profits, alimony, and other revenue streams.
What Will be My Down Payment And Housing Costs
To figure out housing costs and down payment, you’ll want to include estimated mortgage interest rates, homeowner’s insurance costs, annual property tax, etc.
You’ll also want to figure in loan terms – how long you feel it will take for a complete mortgage payoff. Though shorter limits are opted for by some borrowers, a 30-year mortgage is a very common choice.
When Building a New home, Look at Expenses
This is where your expenses will be tallied up. This category refers to a monthly output of money that goes into a home. Look at your spending realistically and try to be as accurate as possible. How much you can spend on a house can be greatly influenced by this monthly expense total.
To get a clear idea of a budget for purchasing your home, the above numbers will be entered into the Builders Showcase Mortgage Calculator (link above).
Important Things to Remember When Building a Brand New Home
Looking for a low rate? The following borrowers receive the lowest rates from lenders:
- Those who put forth a substantial down payment.
- Those who have only a small amount of debt, or none at all.
- Those with the highest credit scores.
Types of Loans
Depending on your situation, any number of loans may or may not be available. Do your homework. Research the following loans to see if you qualify:
- Jumbo loan
- ARM loan
- VA loan
- FHA loan
- 10-year loan
- 15-year loan
- 20-year loan
- 30-year loan
Finding a Home That’s Affordable
The more affordable the house you choose, the better off you will be – particularly if you’re on a tight budget. Here are some tips to finding a place that may fit your finances, even if your budget is on the small side:
- Stay within your means when you are shopping.
- Save on homeowner’s insurance by shopping around. Compare!
- Changes in income sometimes occur, both up and down, so plan for them.
- For emergencies, home maintenance, etc., set aside the appropriate funds. (Consider setting up a bank account strictly for this purpose.)
The Builders Showcase Difference
Ready to figure out your mortgage for your new home? You’ll want to come up with a budget for either a house on a lot or if you already own a lot, just the house itself. The link provided at the beginning of this piece will help you do exactly that. Once you have your budget, then what?
You’ll need a home builder.
If you’re building a home in the greater Milwaukee area, the best home builders can be found by working with Builders Showcase/Milwaukee Homebuilders Television. For Wisconsin residents, more than 5000 homes have been constructed by builders on our show. Their home quality, designs, and craftsmanship are unmatched. From the very first phase of your home building process to the moment your dream home is finished, the builders we work with and promote stay with their clients every step of the way.
If you’d like to be introduced to some builders, find out more about our television show or magazine, find out how to tune in to our podcasts, and more, please feel free to contact us. You can email us at firstname.lastname@example.org, phone us at 262-989-0604, or use our convenient online form to get started.