Is Your Budget Ready for a Mortgage Payment? | St. Johns Bank
Is buying a home in your near future? Whether you’re dreaming of buying in the next few years or have more immediate plans, it’s important to start preparing now.
That’s why our team at St. Johns Bank wants to offer some insight about mortgages.
Are You Prepared for a Mortgage Payment?
Being a homeowner is fun—but it is also a huge responsibility you want to make sure you are fully ready for. If you are ready to be a homeowner, then it’s never too early to start preparing your finances for a mortgage.
Let’s take a look at two things you should do to prepare your finances before seeking a mortgage:
Get to Know Your Credit Score
Do you know your credit score? Your credit score doesn’t just help you get approved for a home mortgage, it also helps determine your interest rate.
Therefore, while you might only need a 600 or above to get approved for a home mortgage loan, the higher the score, the lower your interest rate. As a result, you’ll want to take steps to raise your credit score before applying for a home loan.
Improving your credit score doesn’t necessarily take drastic changes. Taking simple steps such as paying bills on time, reviewing your credit report for false information, and keeping your debt to credit ratio low can have a big impact on your credit score.
Nail Down Your Budget
When applying for a mortgage loan, you will likely be approved for more loan than you actually could pay for.
If you can only afford a $1,100 mortgage payment, buying a $300,000 house (even though you might be approved for that amount) probably isn’t the best option.
As a result, you really want to look at your budget and decide how much home you can legitimately afford. Think beyond the mortgage payment, too—you’ll need to consider insurance and home maintenance expenses as well.
Are you ready to apply for a home mortgage? Contact the team at St. Johns Bank to learn about the various types of mortgage loans we offer.