Start on the right foot


By Kathy Henne



As you consider buying your first home, you’ll get lots of advice, but you shouldn’t do anything without a complete understanding of your financial situation and how much home you can afford. So, where do you begin?

There are two parts to financing – the downpayment and the loan amount. Some loans require a downpayment of 3.5 percent, 5 percent, 10 percent, or 20 percent of the purchase price. If you have great credit scores, you’ll get a better interest rate. You can secure the best interest rate by reviewing your credit report and correcting errors, which are surprisingly common. It’s best to do this at least two months in advance of your home search because that’s how long it can take to clean up your reports. You can receive a free credit report from AnnualCreditReport.com or your loan officer can pull a credit report for you.

You’ll know exactly what you can afford by securing a pre-approval from a reputable, local lender, who will review your income, debt and credit, and suggest the loan program best suited to your qualifications and needs. If you can put down a larger downpayment, you may qualify for a higher loan amount.

With less than 20 percent downpayment, you might be required to purchase Private Mortgage Insurance (PMI) for your lender because the lender assumes a greater risk. Consult with your loan officer about ways to raise the cash for your downpayment, like withdrawals from an IRA or gift funds from a relative.

With your financial house in order, you’re ready to discuss your desires with an experienced real estate professional and begin your home search with confidence. A wonderful new home will soon be yours.

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By Kathy Henne

Contact the Kathy Henne Team RE/MAX FINEST by calling (937) 778-3961.

Contact the Kathy Henne Team RE/MAX FINEST by calling (937) 778-3961.