Make Your Dream Home a Reality with a Mortgage that is Just Right
By Dr. Lauretta A. Farrell, Executive Director, Affinity Federal Credit Union Foundation
Earlier this spring, I decided to put my house on the market. For many reasons, I felt the timing was right and I was excited by a flurry of interest. In just a few weeks, I found the perfect buyer. She had grown up in the neighborhood, but following her divorce, was renting in a nearby town. She was ready to find a more permanent home for her family and she loved the historic detail, rose bushes and white picket fence my house offered. We bonded over a love of gardening and dogs, as she imagined entertaining on the back deck. She left with her realtor and I waited for her offer.
It never came. I was quite puzzled, as I was sure her interest had been genuine. More than a week later, I found out why the offer never came – she did not qualify for a mortgage. I am pretty sure we were both heartbroken.
I share this story because it is an important lesson for all prospective homebuyers. Before you head out to your first open house, talk to a Mortgage Loan Officer (MLO). It won’t cost you anything, and can prepare you to act quickly when you find the house of your dreams – critical in today’s market.
MLOs can help you determine how much you can afford. They will talk with you about down payments, interest rates and loan terms. They can help calculate potential tax savings1 and make sure you know what your monthly payment might be – not just the mortgage, but taxes, insurance, and, if you opt for a condo or town house, any association fees. They can also uncover any financial bumps in the road or issues with your credit that might keep you from getting a mortgage. If there are, they can likely refer you to someone who can help you fix your credit.
Knowledgeable MLOs will review the different types of mortgage products available and help you to decide if a fixed or adjustable rate makes more sense for you. If you are not a bizillionaire (and most of us aren’t), they may recommend an affordable mortgage program, similar to Affinity’s “Your Way Home.” They may even be able to help you find down payment assistance.
Your home will likely be your single largest financial investment. If you do your homework, and take advantage of the resources available, you can find the mortgage, and home, that is just right.
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1 For additional advice, please consult a tax advisor.