Buying A House - Your Constitutional Right in America

My Regional Manager would have rolled up into a ball if he heard my title: Buying A House - Your Constitutional Right in America. I'm not kidding!

Well, I wasn't successful because I listened to him! He may have believed buying a house was not a basic American right but I never bought into that limiting theory. I have always subscribed to the belief that EVERYONE deserves to own a home. Now I'm not speaking entitlement. I mean you have every right, and the responsibility, to go after your piece of the American Dream.

Just add desire.

Owning a home is the dream part of the American Dream and fortunately that dream is attainable for most families. Like most dreams, desire is important and is the first ingredient. If you have the desire to own a home, you have already satisfied the most important step to home ownership.

Because your home is a financial asset, the desire for equity appreciation over time is certainly part of the dream. Although owning a home brings the hope of equity appreciation, it also brings many other benefits to a home owner such as financial stability, a feeling of pride, and the sense of community. These benefits are basic to our American heritage and are ingrained in our society. The right to own a home is one of the important features of our constitution and is what makes living in the United States so great.

As much as we may like to avoid questions regarding our personal finances, buying a home is mostly determined by your current and expected prospects of financial ability and stability. In order to determine if you are prepared to purchase a house, let's answer some basic questions.

#1 The first question regards income. Income needs to be steady and reliable. A steady income refers to your income's consistency. The more consistent your income the better. The reliability of your income mostly refers to its predictability. What is the likelihood of your income continuing into the future?

#2 Of course, income usually comes from employment. So the second question to determining if you are prepared to buy a home is related to job history. If you have worked at the same job or related jobs continuously for two to three years, the employment question will likely not be an issue.

Tip: When a lender is looking at a loan application they are going to examine each of these aspects of your financial life. Popular misconceptions are that lenders are looking for reasons to deny you but in truth, lending is how these mortgage institutions make money. So don't feel intruded upon. Instead seek the guidance of a reputable mortgage lender to help guide you through this process. Use this Mortgage Information Planner to prepare before you contact a mortgage lender.

#3 How you handle debt is extremely important to your financial health and is the third question to address if you are preparing to buy a home. Making payments on time is probably the single most important factor that lenders look for in a prospective home buyer. So if you are sloppy about making payments on or before their due date, I recommend you correct that right now. Late payments are not going to help your credit profile and are bad habits that can be easily corrected.

#4 In addition to timely payments, the fourth issue for a new home buyer has to do with total debt. Bluntly expressed, are you over your head in credit card debt? Some people have large car payments plus high balances on credit cards. Other debts may include boat and recreation vehicles, installment payments for jewelry, furniture, and other items. Credit is easy to get but when qualifying to buy a house the volume of debt can obstruct your ability to get the house you dream about.

Tip: Over the past few years there have been a plethora of mortgage products that allow people to buy homes without down payments. But due to the recent mortgage crisis, these products are not going to be as available.

#5 In addition to examining total debt, are you saving for a down payment. For those who have saved for the cost of buying a home including a down payment, they are a step ahead. It is never too late to begin a gradual savings plan toward a buying a house.

#6 The last issue is one some people don't think of but is also important to your overall financial life. Can you afford a mortgage plus the additional cost related to owning a home? Some of the expenses that occur are home owners insurance, property taxes, yard maintenance, physical upkeep, and various maintenance systems such as electrical, plumbing, heating and air conditioning.

Now before you disqualify yourself from home ownership, I have one more recommendation. Now is the best time to contact a home loan lender and begin the application process. The most important thing when buying a house is to know your options. A reputable and experienced mortgage lender can help you zero in on the most important issues that you may need to address. For the easy path to low mortgage payments use this convenient list of questions when you contact your lender.