“In What Price Range can we Afford a Home?”
I never like answering this question. The question I want to answer is, what mortgage payment are you comfortable with? So often I speak to someone who tells me that they have been approved for X dollars, but they have no idea what a payment would be. This particular person is wise enough to know what they don’t know:
We are exploring our options and have been looking at houses in our surrounding area but have no idea what we qualify for. With that being said, I am asking you to give me and idea for what I can shop for.
It is unfortunate that so many folks don’t get the answer to the question of what monthly payment they are comfortable with. This is an exercise I take each client through and even when we have gotten that answer, we still are not 100% sure of the number, monthly property taxes, homeowners insurance or mortgage insurance ( if applicable).
I always have the clients contact me once they are getting ready to make an offer so that we can do a better job estimating all the numbers. At that point they have a very good idea what the mortgage payment will be.
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Joe Petrowsky, NMLS #6869
Right Trac Financial Group, Inc. NMLS #2709
110 Main St.
Manchester, Ct. 06042
Office: 860 647-7701 x116
Fax: 860 647-8940
Cell: 860 836-9294
Email: joe@righttracfg.com
Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.
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Good morning Joe. My monthly payments went up 100.00 a month because of taxes. We've been in this home for a little over a year and my wife has hinted to start looking for another one. 2016 is going to get interesting.
This is excellent advice, Joe. Especially down here where we have a number of gated communities with some fairly hefty HOA fees.
Good morning, Joe Petrowsky ... one's comfort zone is sometimes not within that range of qualification.... it depends on lifestyle!!!
Good morning Joe. Big difference between what your income says you can afford and what you really can afford! Good counseling makes a difference. Enjoy your day!
Always important to know what someone is comfortable paying each month. It's the same when people finance furniture. They may be approved for a much bigger amount but when they see what the monthly payment will be, they don't spend quite as much.
Joe, you do an excellent job in counseling your clients.
Have to look at the BIG picture....have yet to see anyone spend ALL they are quulified to spend...nor should they...comfort especially for first time buyers who don't realize what impact a deduction has...is paramount to being a happy homeowner.
I agree with you. I always tell my clients that the lender may say they qualify for an amount that may be more than the amount they will be comfortable paying. They should be able to save for a rainy day or for vacations and fun things.
Good Morning Joe:
This is question will always be a part of my buyer counseling session. I will get buyers who are already preapproved for xx amount but they don't have any clue as to what their mortgage payment would be.
If their current rent is $1300 and they would like to stay within this range up to max of additional $200 inclusive of everything, they can't be looking at houses above $200K. It is simple math and logic for an FHA loan.
I shake my head when the loan officers don't ask the question you ask them.
I wish more Mortgage Lenders operated like you Joe, consumers need to know what they can afford in monthly payments and not go by what they can qualify for.
Good morning Joe. Your focus matters as most folks only know what they comfortably handle monthly.
Joe, great point - what they can "afford" and what they "qualify for" is usually different.
Good morning Joe. If there is one arena that is completely aware of this concept it, in my opinion, be car dealerships. Top of the morning Joe. Mark
When I send a buyerto get qualified I tell them not only to asks for costs but to tell the lender how much they would ideally be able to afford a month.
Joe Petrowsky This has always been the case. People buy the monthly paymant, not the purchase price.
Bill Roberts
Joe,
As usual this is very sound advice on your part. A
Many home buyers do need advice on the process. I like your approach.
I hope you are fully enjoying the holiday weekend.
Today, Dolores and I went into Washington, DC to Hillwood Estate, Museum and Gardens to see their special exhibit Ingenue to Icon, 70 years of fashion, and also toured the mansion.
Joe I agree, and when I am asked the same question I respond the same way as you.
Hi Joe,
Happy New Year. This is the benefit of having a great mortgage rep to help buyers.
Joe
You have the expertise to ask your customers the right questions . . . . to guild them through a successful mortgage process.
Good luck and success.
Lou Ludwig
That is rough Joe, I would answer their questions with a bunch of other questions.
I have a mortgage app that my Lender gave me so I will do that as well before we write the offer. We don't want any melt downs on the way to the closing table.
You are so right. Just because someone can qualify for more, doesn't mean they should spend that much!
Great post, Joe. The buyers need to be well informed. I work with a lot of buyers that strive to keep their monthly payments low even though they can afford more. I think that is very wise on their part.
Joe, great post and naturally the right way to look at the process of home buying and how to determine whether a house is right for you. Can you afford it? Simple question. Talk about cart before the horse!
Hi Joe -- wonderfully stated --- comfort level is very important.
Great advice Joe. There should be much more to consider than just what you have been told you qualify for.
It's the unknowns with finances that can kill you! Go in with eyes wide open. So glad that your clients find you--you're the best!
You sound like me Joe Petrowsky . Clients not satisfied with other lenders tell me they were approved for $ xxx but have no idea what their monthly obligation would be or their total outlay including taxes and insurance.
I break it down for them when I do a preapproval and make sure not only the wallet but the stomach can handle it.