For those of you who do not know, total recorded home sales during August of 2010 was the second lowest on record, since records have been kept to report that indicator of economic activity within the United States of America. The truth of the matter is that as long as about 450,000 people file a new claim for unemployment compensation benefits each week you better believe that not many people will be buying a home.
On the other hand, if you have job security, a good income and money saved for the future purchase of a home the chances are that home prices will not go much lower. Take a good look at your financial situation first, before you decide to seek out and purchase the home of your dreams. It is quite possible that the rent that you currently pay each month is equal to or more than you would pay each month for the mortgage you receive from a lending institution.
Given your current financial situation it is wise to determine what kind of a home you can purchase these days. To do so you must go to your bank or someone who works within the mortgage industry, loan officer, to determine if you are, in fact, qualified to receive a mortgage and for how much that mortgage balance will be.
Keep in mind that your monthly mortgage payment might include a prorated amount for real estate taxes, home owner’s and mortgage insurance. Those amounts will increase the cost of each mortgage payment that you make each month to the lender in question.
In regard to the down payment, if you are a veteran of military service or if you desire to obtain an FHA loan you have a few added benefits by doing so. Your required down payment will be less than a conventional mortgage. So too, the property that you select will first have to pass an inspection by the VA or the FHA before they will approve or deny your mortgage request.
Then again, the length of the mortgage is another consideration, in regard to the monthly mortgage payment. For example, if you get a ten year mortgage more of your payment will be allocated to paying the principal amount, but your monthly payment will be larger than if you had a 15 year or a 30 year mortgage. Keep in mind that if you must pay back a 30 year mortgage you will pay almost twice as much as the cost of the home that you purchase, the excess amount is the interest charged each year for the unpaid mortgage balance.
Having taken the above into consideration, you should now know if you will be able to purchase a home, without causing an additional burden to you for the opportunity to live within a home that, some day, will be yours free and clear from ever having to pay rent again.