The 32 year old first time homeowner was celebrating his second Christmas in his own home. Nearly two full years ago he made the decision to quit paying rent, and to start making payments on his own home. No deposit home loans had caught his interest, and after further investigation he realized that this was a great way to become a first time homeowner. His parents helped him look at the homes that were in his price range and he was able to find a nice ranch on a circle drive. The home had a great location, as it also backed to a wooded area that was a protected grassland. After shopping around and considering several local mortgage lenders and options, his parents advised him that he select the one that was offering fixed rate mortgages, instead of the no down payment option.
After successfully making the first six months of home payments, the new homeowner agreed to let two roommates move in. These new roommates were thrilled to be paying less rent than they had paid at their last apartment, and the new homeowner was excited to start making a monthly loan payment significantly larger than what the bank loan required. His risk of buying a new home had worked out and he was pretty excited about this second Christmas in his own home.
What would it take to get you into a home? If you are a potential first time homeowner you may be asking yourself that very question. New buyers who have a substantial amount of money saved for a deposit will likely have more opportunities than most other buyers, but no deposit home loans are another option for a different kind of buyer.
Sometimes all you need is to find a way to get into a home. A way to quit paying rent to a landlord, and start investing in yourself as you make payments on your own home. Every institution has different requirements for the down payments that they require, but most financial advisers say that new owners should make at least a 3.5% down payment.
Even if you have not yet made a decision to buy a home, there are many things that you can begin doing that will increase your success when you do. For example:
- Although it may sound difficult, save as much as you can for a down payment. If a person has a low credit score, he or she can offset that score by making a bigger down payment. Although no deposit home loans are available, these types of mortgages can often have significantly higher interest rates.
- Ellie Mae, one of the leading direct mortgage lenders, reports that the most successful mortgage borrowers do not exceed a 24% housing debt-to-income ratio.
- Your total monthly debt, including a mortgage payment, should not be more than 36% of your gross income.
- Make every attempt to clean up your credit history before applying for a home loan. This includes removing any errors from your report, as well as paying down, or eliminating, credit card debt.
- Llock in low interest housing rates as soon as possible. The last ten years have seen some of the lowest ever interest rates. If you are looking for one of these low interest loans, you want to lock it in as soon as you possibly can.
Whether you are a 32 year old single person, or a newly married couple, working toward owning a home is a good financial decision that many people strive toward. For more information, read this website.