Start Planning Now for a Florida Home Mortgage

Maybe you don’t plan onn buying a house for at least a year. That’s fine. But it’s never too early to begin planning. The more you know about the Florida home loan process now, the easier it will be to complete - in an affordable fashion - when the time arrives.

Examine your finances

Figure out your monthly income and budget, including regular and incidental expenses. If you expect any changes that will affect your income over the next year, such as a raise or a new car, make a note of it. This exercise will give you an accurate picture of your finances to help determine how fast you can save for a down payment.

Start a savings plan

Try to give yourself a timeline, such as a year, and a target amount to save. Once you have a budget, see if you can trim your spending. Cutting out any little expense will help so the amount of your Florida home mortgage is as little as possible. It’s a good idea to keep your savings in a separate account to avoid the temptation to spend it.

Consider the up-front costs

These can add up. Most lenders require a minimum of five to 20 percent of the home’s purchase price as a down payment. On top of that, you will have closing costs to consider, which can be anywhere from two to six percent of your Florida mortgage loan amount, as well as the cost of a home inspection, which can cost from a few hundred to a thousand dollars.

Check out down-payment assistance

Don’t panic if you can’t save 20 percent for a down payment. There are ways to buy a house with a smaller amount of cash up front. Look for lenders that offer low-down-payment products from Fannie Mae and Freddie Mac. Another option is to get help from nonprofit-supported down payment assistance programs.

Calculate how much you can afford

Keep in mind, along with a monthly mortgage payment you’ll have to pay for utilities, property taxes and homeowner’s insurance. By calculating how much house you can afford, you will have a better idea of where to begin. For example, if you can afford a maximum monthly payment of $1,000, you’ll be looking at a total Florida home mortgage loan of $166,792 (assuming a 30-year fixed rate at six percent). Knowing this limit will help you be realistic - and keep you from getting too attached to a home listed at $250,000.

Get pre-approved for a mortgage

A lender will pre-approve requests for Florida home loans based on your income, debts and credit. By taking this step, you’ll know in advance how much you will be able to borrow so you won’t have to make your offer dependent upon securing financing. To find out how much you qualify for, and to get quotes from lenders, submit the RISK-FREE, COST-FREE application.