FAQ's when Buying Real Estate

What can I afford?

The general rule of thumb is that your monthly mortgage payment should not exceed 28% of your gross monthly income. Find out how much you can afford to borrow by contacting a mortgage broker or lender.

For instance, if you gross $10,000 per month, your monthly payments (including fees and maintenance) should not exceed $2800 per month.

 

Why should I buy instead of rent?

If you rent an apartment, you are paying money every month with no financial return. When you buy a property, you can deduct the amount of interest from your mortgage from your federal income taxes, and possibly from your state taxes. You can also deduct the amount of property taxes you pay as a homeowner. This means significant savings at the end of the year. Ask your broker to prepare a purchase cost analysis, which breaks down your monthly cost, estimated tax deductions and discounts.

Additionally, as you pay down your loan, you are earning equity in the property if its value remains stable or appreciates. Equity is the cash value of your home, minus the current loan balance.

 

What is the difference between pre-qualified and pre-approved for a loan?

If you are pre-qualified for a loan, you potentially can get a loan for the amount stated, based on the information you provided.

 

If you are pre-approved for a loan, you have already undergone an extensive financial background check, supplying your credit history, previous tax returns and employment verification to the lending institution. The lender is willing to give you a loan based on this information and has provided you a letter, valid for 60 days, stating you are pre-approved for a loan of a specific amount.

 

How do I get started?
Contact an Exit Real Estate Expert today because buying with Exit means you can get Moving!