Home Buying Tips
When you decide to
purchase a new home, your first step should be to determine how much
you can afford to spend. Of course, your mortgage lender will
ultimately assess the amount you're eligible to borrow. Therefore,
you need to target an appropriate price range before you begin house
hunting.
To get an estimated figure, look at your monthly budget and estimate
how much you're willing and able to set aside for your mortgage
payment each month. You should also consider how your monthly
mortgage payment will relate to your total monthly income.
Generally, your total housing expense should not exceed 28% of gross
monthly income (FHA is 29%, VA is N/A). Your total housing expense
is the sum of principle, interest, and escrows. Also, total monthly
obligations should not be greater than 36% of gross monthly income
(FHA and VA are 41%). Monthly obligations include total housing
expense plus payments on installment loans revolving credit
payments, mortgage payments on real estate that doesn't produce
income, and alimony and child support payments.
When it comes to the insurance
industry, mold is not part of the standard insurance policy and is
only covered if it's as a direct result of a covered peril.
According to Dr. Robert Hartwig of the Insurance Information
Institute, "The costs of cleaning up mold caused by water from a
burst pipe are covered under the policy because water damage from a
burst pipe is a covered peril. But mold caused by water from
excessive humidity, leaks, condensation or flooding is a maintenance
issue for the property owner, like termite or mildew prevention, and
is not covered by the policy."
Some home buyers choose to purchase a
home warranty along with their new home. A home warranty
protects against breakage and repair and can include replacements
for mechanical systems and built-in systems in the home. Two
popular home warranty providers are:
Some home buyers also choose to
investigate the property insurance loss history. The property
loss history on a property can seriously impact insurance rates and
the ability of homebuyers to insure a property. This and more
information is available at ChoiceTrust.com
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