Don’t strap yourself with too much house.

There are definitely some things you need to  consider when choosing a home you’d like to purchase. Location is right up there on top, and of course, price and size.

Since it’s best to put at least 20% down payment on it to avoid mortgage insurance. Keep your budget in mind as you shop for a lender who will go to the high side of what you ”can afford”. You set you highest price keeping in mind that there are always costly surprises over time, and you need to be sure to have money set aside for the ‘what ifs’. So stay under their figure.

Don’t go for all the bells and whistles. They are where the dollars rise sharply in the listing price. And remember, once in there, you may want something different such as paint, carpet, flooring, larger shower etc.

Don’t buy too many rooms. Remember, you have to fill them and heat/cool them….and pay taxes on them. It’s always nice to have an extra bedroom which can be utilized in many ways. This home may be your forever home, but you more than likely will use it at a first step towards home ownership, giving you ideas and lessons as you move forward.

Remember, your PITI, principal, interest, taxes, and insurance should be no more than 30% of your take home income, and ideally, 28%. This will keep you more in line with staying within your budget.

You’ll want to put aside approximately $500. for a home inspection.  This will tell you what is wrong with the property and approximately costs to repair it.  If it is too costly, now is the time to have the sellers pay for the repairs, or give you the money to do so. A home inspection is very important, don’t neglect it. Also, don’t forget that at closing, you’ll need approximately $5,000 for closing costs (Registry of Deeds, Lawyer, etc).

And it is a very good idea to do a Homestead Act at the time of closing. It costs only $35. and is money well spent.  Mention it to your Lawyer that you want it at that time, and it will protect your home from anyone who may sue you. It covers about $300,000. and protects your home for as long as you own it.