Be Prepared

It is important to know how much you can afford to spend before you even begin your search. Research your credit history by requesting a copy of your credit FICO Score. It is helpful to have both on hand before you apply for a loan. To figure out your Debt-to-Income Ratio divide your monthly payment obligation on long term debts by your gross monthly income. 

Know What Will Affect Your Loan

As stated above, both your credit history & debt-to-income-ratio affect the terms of your loan through your FICO Score. If you have good credit & your monthly income far surpasses your monthly debt obligations, you are likely to receive lower interest rates. However, if your monthly income barely covers your minimum debt obligations, even if you have good credit, you may not walk away with the lowest interest rate around.

The other important factor to consider is how much you can afford for a down payment. You should also consider what type of loan is suitable. There are many different types of mortgages, and a mortgage that is not discussed here may be better suited for you. Ask your lender for more information about these and other types of loans.

Fixed-Rate Mortgage Loans

If you plan to stay in your house for a long time, your mortgage rate is probably a big concern. Because your interest rate stays the same throughout the entire life of your loan, a fixed-rate loan ensures that there are no surprises. Fixed-rate mortgages are available in a variety of repayment terms, with 15, 20, and 30 years the most common.

30-Year Fixed-Rate Mortgage Loans

With the 30-year fixed-rate, you will be able to keep your payments down by making them over an extended time period of 30 years. This loan is the easiest fixed-rate to qualify for and provides the maximum interest deduction for taxes. If you are planning to stay in your home for a long time & would like to have the extra money for other purposes, this type of loan is your best bet.

The benefit to the 20-year fixed-rate over the 30-year is that not only do you become debt free 10 years sooner, but the interest rate is often much lower. This mortgage may save a considerable amount of total interest in the long run, but the monthly payments will probably be much higher than the 30-year fixed-rate.

The 15-year fixed rate has the lowest interest out of the fixed-rates and will save you a significant amount of interest. Since you would be paying off the mortgage quicker than the other fixed-rate loans, you will also build up equity in your home a lot sooner. Again, expect your monthly payment to be higher than the 30 or 20 year loan.

With an adjustable-rate loan (ARM), the interest rate adjusts periodically as the market rates change. This means that your monthly interest rate could go up or down. These loans are attractive because they usually offer a lower initial interest rate than a fixed-rate loan. The other benefit to this is that many people qualify for larger loans due to this initially lower rate. Of course, the downside is that the rate can increase.

• If you are confident that your income will rise enough in the upcoming years to support an increase in interest rate.
• If you plan to move in the next few years and therefore aren't concerned with an increase.
• If you need a lower initial rate to afford to buy the home you want.

Balloon loans are attractive because they offer a lower interest rate for a short term financing period. However, at the end of the term, you will be required to either pay off the outstanding balance in one lump sum or you can refinance the loan. If you choose to get a balloon loan, make sure that you know all the conditions that apply for refinancing. Most people who choose a balloon loan plan to sell or refinance their home within a few years and want a fixed, low payment.

A number of agencies offer government-insured loans.

An FHA loan allows you to put down a very low down payment on your home. The maximum loan limit is based on the average cost of living in your area.

The VA loan allows qualified military veterans to buy a house with no down payment. There are restrictions on the home's price, but if you qualify, a VA loan is an option worth investigating.

The Rural Housing Service (RHS) loan offers low interest rates with no down payment. It is available to households with low-to-moderate income located in rural areas or small towns.

Many states and local housing agencies offer special programs for first-time home buyers. These programs typically offer mortgages with low down payments or lowered interest rates. Some agencies even offer assistance with down payments and closing cost. Check with your local state housing authority for more information.

These loans are for households of low to modest means. For qualifying families, Fannie Mae, in cooperation with housing providers, can help with high down payments, closing costs & housing expenses by offering flexible underwriting ratios that allow you to use more of your monthly income toward housing costs. These loans require a smaller down payment and a lower closing cost than normal mortgage loans. Generally, you are eligible if your household income is no more than 100% of your area median income.

So, you've found a house. Now you have to pack up and move.

Moving can be one life's most stressful times. However, it doesn't have to be. Here are some tips to make the move easier. Remember, whether you’re moving across the country or across town, preparation is essential.

Checklist:

• Use things you can't move, such as frozen foods and cleaning supplies.
• Obtain information about your new community.
• Get a floor plan of your new residence in order to pack efficiently
• Get estimates from at least three moving companies.
• Call your homeowners insurance agent to find out if your move is covered by insurance.
• DOCUMENT ALL MOVING PAPERS & RECEIPTS.

Also, check with your tax advisor. Many moving expenses can qualify as income tax deductions.

Other Considerations:

Complete post-office change of address cards.

• Consider a moving/garage sale or donate items to charities. It's amazing how much stuff you realize you have when you decide to move.
• Contact your mover to make arrangements and inquire about insurance coverage.
• If relocating due to a job, see if your employer will cover the costs.
• Gather auto licensing and registration documents, medical, dental and school records, birth certificates, wills, deeds, stock and other financial documentation, etc.
• Contact gas, electric, oil, water, telephone, cable TV, and trash collection companies for service.
• Contact insurance companies to arrange for coverage in your new home.

Moving Day

• Record all utility meter readings (gas, electric, and water).
• Stay until your movers are finished.
• Carefully read all  document before signing it.
• Keep your copies of the bill of lading and inventory until your possessions are delivered, the charges are paid, and any claims are settled.
• Give movers clear directions to your new home, and an emergency number where you can be reached during the move.

At Destination

• Be at the destination to welcome the movers and answer any questions.
• Scrutinize the unloading of your items and account for each one on your inventory sheet. Check promptly and carefully for any damaged or missing items.
• Place moving and other important documents in a safe place.

Important Packing Tips:

• Cushion the bottom and sides of boxes first.
• When packing, go room-by-room.
• Begin your packing as early in the moving process as you can.
• Label all boxes - by item, condition of that item, and where in your new home it should be placed.
• Thoroughly wrap your "breakables" in newsprint paper, paper towels, or clothes, placing them in dresser drawers, containers with lids, large cans, etc.
• Tape cords underneath all electrical appliances.
• Don't tape furniture doors and drawers. It can cause damage - instead, use rope or elastic to secure furniture.