Maximum Loan Amount

The lender considers your debt-to-income ratio, which is a comparison of your gross (pre-tax) income to housing and non-housing expenses. Non-housing expenses include such long-term debts as car or student loan payments, alimony, or child support. According to the FHA, monthly mortgage payments should be no more than 29% of gross income, while the mortgage payment, combined with non-housing expenses, should total no more than 41% of income. The lender also considers cash available for down payment and closing costs, credit history, etc. when determining your maximum loan amount.
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Inspection Etiquette

Do I need to be there for the inspection? It's not required, but it's a good idea. Following the inspection, the home inspector will be able to answer questions about the report and any problem areas. This is also an opportunity to hear an objective opinion on the home you'd like to purchase and it is a good time to ask general maintenance questions.
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Credit Bureau Scores

A credit bureau score is a number, based upon your credit history that represents the possibility that you will be unable to repay a loan. Lenders use it to determine your ability to qualify for a mortgage loan. The better the score, the better your chances are of getting a loan. Ask your lender for details.
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Federal Housing Administration

Now an agency within HUD, the Federal Housing Administration was established in 1934 to advance opportunities for Americans to own homes. By providing private lenders with mortgage insurance, the FHA gives them the security they need to lend to first-time buyers who might not be able to qualify for conventional loans. The FHA has helped more than 26 million Americans buy a home.
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How Much House

The conventional home buying wisdom is to buy as much house as you can afford. It is important, however, to limit your mortgage obligation to what you can comfortably manage, especially during times when the economy is uncertain.
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Good Credit

Credit problems won't prevent you from obtaining a mortgage, but they will increase the cost. So try to put some time between your problems and your home purchase so you can reestablish good credit. Keep in mind, however, that interest rates, home prices, or both might rise while you work to boost your credit score.
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Improvement Records

Beginning on the day that you complete the purchase of a home, keep track of everything you spend on major improvements. You will need to document those expenditures, which increase your home's "basis" (and thus reduce your net "gain") when you eventually sell. Even with today's liberal capital gains exclusion, rapidly rising home values may push some homeowners closer to the taxable gain threshold faster than they suspect.
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Financing Fine Points

- Payments on some loans may not cover interest due so the loan balance could increase rather than decrease.
- Under certain conditions, a creditor may terminate the plan and require payment of the outstanding balance in full in a single payment and impose fees upon termination; prohibit additional extensions of credit or reduce the credit limit; and, as specified in the initial agreement, implement certain changes in the plan.
- For variable-rate products, the APR, annual percentage rate, does not include costs other than interest.
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Selecting a Realtor

Start by asking family and friends if they can recommend an agent. Compile a list of several agents and talk to each before choosing one. Look for an agent who listens well and understands your needs, and whose judgment you trust. The ideal agent knows the local area well and has resources and contacts to help you in your search. Overall, you want to choose an agent that makes you feel comfortable and can provide all the knowledge and services you need.
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