Are You Ready to Buy a Home?

A home is a large financial commitment, and you want to make sure you're financial stable before you take out a mortgage.

The size of the down payment you've saved. If you've saved a down payment of less than 10%, you might wait a while before taking out a mortgage. If you've saved between 10-20%, you're in a good position for a loan with Mortgage Loan Professionals. Ideally, you should make a 20% down payment because you can avoid having to buy private mortgage insurance and get better rates and terms.
The amount of your income, before taxes, that you will have to devote to housing costs (mortgage payment, property taxes, & homeowners insurance). Most mortgage loan professionals like to see that you're spending no more than 28% of your income on housing costs. If you fall below 28%, you're in even better shape.
Your employment/career status. Where you are with your career can impact your readiness for a Mortgage Loan Professionals mortgage. Most lenders like to see at least two years at the same job. Thus, if you're just starting a new career, you would be wise to wait a while before you buy your home. For those who are self-employed or work on commission, you can still get a mortgage, but you might have difficulty if you can't document your income.
Your debt situation. If you carry a substantial amount of debt, mortgage loan professionals might be reluctant to approve you for a loan. Experts recommend, and mortgage professionals agree, that you spend no more than 36% of your pre-tax income on debt, including mortgage payments. That means, including the 28% max for housing costs, your other debts should consume no more than 8% of your income.
Your credit score. The interest rate mortgage loan professionals can give you will be tied closely to your credit score. A very low credit score might preclude you from qualifying, while a score of 720 or above will get you the most competitive rates.

Are You Ready to Buy a Home?

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