I was watching a show on one of my favorite network stations. It was amazing the emotional rollercoaster new homebuyers were experiencing while searching for the perfect home.
One couple had a list of wants and needs. They had a budget in mind and how much home they were able to afford. They couldn’t live without the granite countertops, four bedrooms, three baths and numerous cosmetics fixtures.
The list of ideas went out the door when they stepped into the first place. It was completely opposite of what they “wished” for, but it looked great.
The emotional purchase of the home was beginning to exude from the souls. Although the real estate agent wasn’t pushy, you could see the joy of a quick sale written all over her face.
Everyone’s action was clearly understandable. The process of purchasing a new home is an emotional rollercoaster.
What have we learned from the previous years in the home market?
First time homebuyers can take advantage of other’s mistakes. Follow the rules of purchasing a home and negotiate your wish list.
Live by the rule of 28/36:
The standard mortgage payment shouldn’t exceed 28% of your monthly gross income. Your total monthly debt shouldn’t exceed 36%.
Since consumers were being thrown credit and debt from in many directions, those numbers have far exceeded the recommended percentage of gross monthly income. In today’s numbers many household debt to income ratio is approaching 80% plus.
Mismanagement of money and approval of credit has allowed for loan modification for existing homeowners. The loan medication plan will allow you to (temporarily) reduce your mortgage payment to 31%. This will give you the opportunity to get your debt under control.
Other ways to get your household finances under control are to:
Control your spending habits.
Find a second job to rapidly pay toward debt.
Turn a hobby into an income.
Negotiate credit balances with lenders.
One couple had a list of wants and needs. They had a budget in mind and how much home they were able to afford. They couldn’t live without the granite countertops, four bedrooms, three baths and numerous cosmetics fixtures.
The list of ideas went out the door when they stepped into the first place. It was completely opposite of what they “wished” for, but it looked great.
The emotional purchase of the home was beginning to exude from the souls. Although the real estate agent wasn’t pushy, you could see the joy of a quick sale written all over her face.
Everyone’s action was clearly understandable. The process of purchasing a new home is an emotional rollercoaster.
What have we learned from the previous years in the home market?
First time homebuyers can take advantage of other’s mistakes. Follow the rules of purchasing a home and negotiate your wish list.
Live by the rule of 28/36:
The standard mortgage payment shouldn’t exceed 28% of your monthly gross income. Your total monthly debt shouldn’t exceed 36%.
Since consumers were being thrown credit and debt from in many directions, those numbers have far exceeded the recommended percentage of gross monthly income. In today’s numbers many household debt to income ratio is approaching 80% plus.
Mismanagement of money and approval of credit has allowed for loan modification for existing homeowners. The loan medication plan will allow you to (temporarily) reduce your mortgage payment to 31%. This will give you the opportunity to get your debt under control.
Other ways to get your household finances under control are to:
Control your spending habits.
Find a second job to rapidly pay toward debt.
Turn a hobby into an income.
Negotiate credit balances with lenders.
Be inspired,
Bahiyah Shabazz
Bahiyah Shabazz
2 comments:
Guess the same applies to purchasing a new vehicle too. Cause you know once you sit down it in... emotions take over AND 9 outta 10 times most folk are gonna drive off with it. I guess gettin my emotions in check FIRST could potentially save me YEARS of debt. Great post Bahiyah
Keep on asking money related questions - money is significant
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