First time buyers shopping tips

Want to buy your first home? Follow these tips

According to the National Association of Realtors, in July 2012, 34% of buyers are first time home buyers. This may sound great, but the fact is - when we are in a healthy economy, the first overseas account at least 40% of the purchase!

Reduce behind?

Some people simply do not want to deal with the housing market - rather than choose to rent until the economy improves.

Others can not wait for their first home to get the key, but they just do not put in the financial. And to remember the more than 20-year-olds getting lower and lower wages - student loan debt is growing.

If you want to be a first time home buyer sooner rather than later, here is what you need to do:

1. Realistic

If you do not have enough money saved to make a down payment of at least 10%, and forgot to buy a home. Required after years of little or no down payment, lenders have begun to ask for more money early since the bubble burst.

Similarly, if you have a credit report to get a number of red flags. If your credit score is at least 620, most lenders do not even have to talk to you.

Once you have a realistic assessment of yourself as a buyer, to see what could be done to improve. By understanding what you need qualifications - see how far you fall short - you can come up with a plan, you are in a better position, as soon as possible to buy.

2. Do not be intimidated by the competition

If you are interested in a family of low-cost, odds are you will be investors willing to pay cash competition. (Do not think that in real life? Miami home buyers - 65% of cash payments, their house back in June!)

If your competition is willing to pay in cash, the seller may pick him up. After all, the seller does not have to worry about the lender get in the way!

If this happens, you know you are not alone - and continues to try.

If you want to try to stop it from happening, get pre-approved. Your lender will still have a say in whether they will write a specific house mortgage, but it is a little more in your corner, when you have to compete with others.

3. Cooling and consumption

If you go out and get a few new Credit Card or start large purchases (such as a new home, you think you are ready at any time fancy new gadget), it can throw a wrench in good credit rating.

Why?

Racking up more debt, and make them look risk lenders. Even if you can still be eligible, you may liquidation to pay higher mortgage rates.

4. Look at your debt

Just because you get the approval of the loan does not mean you can actually afford. If you do not want to end up being hundreds of millions of homeowners foreclosure (or millions have missed at least one payment), you need to take a long look at your debt.

Do it the best way to calculate your debt-to-income ratio:

Let's say you earn $ 40,000 a year before tax and net of health insurance. This means that your total monthly income of $ 5,000.

Now, let's say you have $ 2,000 per month "liabilities". These are debt you pay off, such as your cars, your student loan payments, credit card bills, etc.

This means that your debt-to-income ratio of 40% - or 40% of your gross monthly income towards the settlement of debt. This does not include mortgage payments, homeowners' insurance, property taxes, and all other attendant buy a house! When you look at it this way, you may not be ready like you think.