Tips for First-Time Home Buyers
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Purchasing a home can be an excellent investment, according to the Michigan Association of CPAs, but there are some important issues to consider when you do. The first step is to decide how much house you can afford. As a general rule, your monthly housing cost should not exceed 25% to 30% of your gross monthly income if you want to qualify for a conventional mortgage. Monthly housing costs include your mortgage principal payment, interest payment, property taxes and home insurance.
To determine your possible mortgage costs, you can use a mortgage calculator like the one found on the Web site of the CPA profession’s 360 Degrees of Financial Literacy program at www.360financialliteracy.org. To use the calculator, fill in your total expected mortgage amount, the interest rate and the mortgage term. You can change the amount or other factors until you find the right price for you. And if you need advice on buying a home or any other important financial question, consult your local CPA. He or she has the expertise to help you make the best financial decision for your situation.
