The Definitive Decision-Making Guide to Help You “Crunch the Numbers”
When you get to the point in your life where you feel well-equipped to purchase a home, there are several things to consider, starting with the amount you can afford. Nick Toma provides you with some tips on how to crunch the numbers when investing in real estate in Northville.
Start with Determining Your DTI – Debt-to-Income Ratio
Of course, the initial consideration when buying a house is the finances. Evaluate your funds at the moment. If you have enough funds to pay for a house outright, then you can definitely afford to buy one. However, you will want to determine how much mortgage you can manage. Learn more about this by contacting your bank or Nick Toma’s staff.
Evaluate Whether You can Make a Down Payment
It is recommended to make a down payment of 20% on a home to avoid paying private mortgage insurance (PMI), which can add significant costs to your monthly mortgage payments.
However, there may be situations where making a smaller down payment is more suitable, such as if you plan to sell your home in the near future or intend to turn it into an investment property. When purchasing real estate in Northville, it’s always important to talk with your financial advisor to discuss your options for a down payment on a property.
Take the Current Economy into Account
The real estate market can fluctuate, with some years seeing low prices and others seeing high prices. If prices are low and it is clear that you are getting a good deal, it may be a good time to buy. If prices are down, there is a higher likelihood that the value of your home will increase in the future. You should take the following two areas into account:
The Time of the Year – Spring is the best time to buy a property as there is a range of homes up for sale. Buy a home in winter if you want to invest during the downtime.
Interest Rates – They have a significant impact on the size of a monthly mortgage payment and also fluctuate over time.
Think About Your Current Lifestyle
When investing in real estate in Northville, money is not the only factor to consider. Other important considerations include your current and future living needs, such as an impending need for more space or a change in family circumstances.
Before committing to a mortgage payment, consider if it will leave enough room in your budget for your other expenses, including hobbies and lifestyle choices. If the calculated mortgage payment does not fit your budget, you may need to consider a less expensive home or reconsider your budget.
Shopping for Real Estate in Northville? Contact us!
Our staff at Nick Toma can guide you through the process of investing in real estate in Northville. If you need assistance with finances or guidance in navigating the housing market, contact our team today!
