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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