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When seeking a mortgage, you might need to fall under certain credit score requirements.

Getting your credit score into the “excellent” range

One of the most significant factors lenders look into when considering people for loans is their credit scores. For those whose credit card falls below the average range, it can be tricky to get a mortgage.

Typically, credit scores range from 300 to 850. Lenders have different ideas of what they consider to be a "good" or "bad" credit score. However, ValuePenguin reported an approximation of the categories of credit scores as follows:

  • Excellent: 800-850
  • Very good: 750-799
  • Good: 700-749
  • Average: 650-699
  • Poor: 600-649
  • Very poor: 550-599
  • Bad: Below 550

Over 53 percent of the population has a credit score that is above the "good" range. Only 18.4 percent has an "excellent" credit score. Why exactly does a good score matter? Why do people strive for an "excellent" score?

The benefits of an excellent credit score
When people work hard at attaining and maintaining an excellent credit score, they can reap plenty of benefits. Some of these perks include:

  • Great credit card options, such as rewards cards and 0% balance transfer cards.
  • Low interest rates when taking out loans.
  • Better car insurance rates.
  • Approval for leases on rental properties.

How to improve your credit score
The best way to maintain and improve one's credit score is to monitor this number over time. Lexington Law reported that, of the 1,000 people they surveyed, 54 percent of Americans do not check their credit score. Checking this score on a daily basis is not at all necessary, but for someone trying to improve their score, checking on a monthly basis can help keep them on track.

Additionally, individuals should understand what factors are detrimental to their credit scores. Knowing what these risk factors are can help them plan to negate this undesirable activity.

To get their credit score into the "good" or "excellent" zones, individuals should make sure the debt they owe stays below 10 percent of their total credit limits. They should also make all of their mortgage or student loan payments on time.

Getting an excellent credit score involves a nearly perfect record, with no delinquent payments on loans or taxes. Just as important as preventing debt is maintaining the strong record. Particularly if someone has a blemish or two on their credit history, they can still get an excellent score, but they will need to work harder for a longer time to do so.

For more information about this article, call 866-614-5959.

First-time buyers oftentimes have trouble figuring out how much they should contribute to their down payment.

What’s the right size for a down payment?


First-time homebuyers often do not know how much they should contribute in upfront costs on their new house. They don’t want to overpay, as they want a cushion in savings, but they also want to put down enough money to qualify for their lender’s approval. If homeowners can afford to pay the ideal amount on their down payment, they should do so. However, if they do not have enough savings to do so, they can look into alternative options.

The optimal down payment
Typically, lenders prefer buyers to put at least 20 percent down on the house. If this is the minimum they will accept, the buyers might need to secure the mortgage by taking out a second loan. Before the 2008 recession, lenders did not always require buyers to put a minimum amount of cash down on the home. Some buyers could even take out mortgages that cost the full asking price of the home. However, the recession caused families to default on mortgages, especially ones with smaller down payments, leaving many of them facing foreclosure.

Options for smaller down payments
When homeowners want to buy a home but cannot afford the full 20 percent down payment, they have a few different courses of action:

  • Get private mortgage insurance. When homebuyers put less than 20 percent down, their lender might require that the mortgage be insured in case the buyer has trouble making payments in the future. These premiums typically cost between 0.3 percent and 1.15 percent of the loan amount each year, according to SmartAsset.
  • See if they qualify for FHA-approved loans. Zillow reported that the Federal Housing Administration backs loans for buyers with a decent FICO score and who are willing to put approximately 3.5 percent down.

For more information about this article, call 866-614-5959.

Deciding if you're financially prepared to buy a home means looking at your current debts, earnings and savings.

How to know if you’re financially ready to buy a home

Current renters might be wondering if it's time to buy their first homes. Going from monthly rent payments to paying off a home is a big step, but it can be an excellent investment for people looking to settle down. Down-payments and mortgage costs might scare prospective buyers from taking the leap, especially if they still have debt from car or student loans.

Some of the most significant benefits of buying a home include:

  • Tax-deductible interest payments.
  • Flexible mortgage options.
  • Freedom to make the house into a home without needing the landlord's permission.

However, some costs homeowners make that renters do not worry about include:

  • Paying for home repairs and renovations.
  • Homeowner's insurance.
  • Property taxes.
  • Real estate broker expenses, if moving.

If individuals have enough finances to pay for a house in cash, they can afford to buy the home. However, if they don't the means to do this, as is the case with many Americans, they should consider taking out a mortgage. If households have the funds to get a mortgage, they should be financially ready to buy a house. What kind of income and savings can qualify individuals for mortgages?

Back-end debt-to-income ratio
The Federal Housing Administration typically uses this standard when approving mortgages. A back-end DTI of 43 percent typically suggests that homebuyers can afford to make their mortgage payments every month. The types of debt that make up this number include (but are not limited to):

  • Mortgages
  • Mortgage insurance
  • Property taxes
  • Homeowner's insurance
  • Student loans
  • Credit card fees
  • Car loan payments

According to this FHA guideline, these regular debt payments and housing-related costs should not be more than 43 percent of the household's monthly gross income.

Front-end debt-to-income ratio
Some mortgage lenders might take this number into consideration. This ratio is similar to the back-end DTI, but only considers debt regarding housing costs. According to Bankrate, lenders consider an ideal front-end DTI to be no higher than 28 percent.

How to calculate front- and back-end DTI
To demonstrate how to calculate both types of debt-to-income ratios, it might be helpful to provide an example. Using the following monthly expenses, what is this household's back-end DTI?

  • Gross earnings: $5,000
  • Student loans: $250
  • Credit card fees: $100
  • Car loan payments: $372

To figure out the target back-end and front-end DTI, multiple the gross income by 0.43. This means these homebuyers should have a back-end DTI below $2,150. Since the sum of the amount given is $722, this means the housing-related expenses should be below $1,428.

Calculating the front-end DTI means multiplying the gross income by 0.28. When searching for homes, this household should try to maintain a front-end DTI of approximately $1,400. This means the sum of their mortgage, mortgage insurance, property taxes and homeowner's insurance should be around this cost on a monthly basis.

Making sacrifices
If potential homeowners enjoy going to expensive restaurants, traveling to exotic locations working out at high-class gyms or doing costly activities on the weekends, they might need to give some of these expenses up when saving for a house and affording mortgage payments. If they are not willing to forfeit these pricey hobbies, they might not be ready to make the investment commitment of purchasing a house.

Saving for retirement
Before buying a house, individuals should have started saving up for retirement. Perhaps they have a workplace 401k plan or an IRA, in which a percentage of their earnings go directly into their retirement funds. The Balance recommended individuals have 10 to 15 percent of their income in their retirement plan.

Preparing for the worst
If something unexpected happens, like losing a job, getting a divorce, experiencing a costly health problem or making a poor investment, homeowners should always have a cushion to fall back on. Without a backup plan in mind, people can lose their homes to short-sale or foreclosure, which can be extremely damaging to their finances and credit scores.

For more information about this article, call 866-614-5959.

A fixed rate mortgage can help buyers afford their next home.

What is a fixed-rate mortgage?

When purchasing a home, buyers have plenty of options in the house hunting process. Once they make their decision, they face an important course of action: financing the home. Homebuyers have plenty of choices on what type of loan to buy. A common type of home loan, a fixed-rate mortgage, can help homebuyers afford their new space.

A fixed-rate mortgage has a static interest percentage throughout the whole term of the loan. Even if buyers face difficult times, like divorce, losing their jobs or a rocky economy, these loans stay the same. Because homebuyers like this stability, fixed-rate mortgages are the most popular type of home loan. Fixed interest rates can make it easier for buyers to budget their money than less predictable adjustable rates might.

Fixed- vs. adjustable-rate mortgages
When homebuyers first take out fixed-rate mortgages, they might pay more in interest than they would on an adjustable-rate mortgage. However, ARMs' interest rates rise after three, five or seven years, according to Bankrate. After this initial increase, these costs can fluctuate throughout the mortgage term.

Buyers typically pay off fixed-rate mortgages at a slower rate than they would pay off an adjustable-rate loan. Since the first few years of payment typically go toward interest, fixed-rate mortgages might not be a smart investment for buyers who might sell their home again in five years or less.

Fixed-rate mortgage terms
Homebuyers can choose the amount of years they can take to repay their home loans. Typically, individuals can take out fixed rate mortgages of 15- and 30-year terms. Both amount of time have different perks and downsides. Understanding these factors is crucial in deciding which mortgage term are the best fit for homebuyers.

30-year terms typically have a higher interest rate than 15-year terms, but longer terms have lower monthly payments. These lower monthly payments are appealing to buyers who want extra cash in their pocket for emergency spending. Freddie Mac said that over 90 percent of today's homebuyers get a 30-year fixed-rate mortgage.

15-year loans usually also require homebuyers to pay a lesser amount of interest over the loan's term. These mortgages are ideal for individuals who don't mind paying a higher monthly cost but who want to pay their home off faster.

For more information about this article, call 866-614-5959.

Closing on a home is a crucial step in the home-buying process.

What to expect when closing on a home

Moving into a new home can be exciting. It might be a first home, a fresh start, an upgrade or a downsize. Regardless, changing addresses is the beginning of a new chapter. Despite the excitement of buying a home, closing on one isn't quite as enjoyable of a process, though it is imperative that this process goes smoothly. The National Association of Realtors reported that 31 percent of home sales in August of 2018 were from first-time buyers who have probably never experienced a closing before.

Between price negotiation, home inspections and contract-signing, both parties can get burnt out by the end of the homebuying process. Although buyers are ready to celebrate once they've signed the Purchase and Sale Agreement, their work isn't complete just yet. There are several steps between the contract negotiation process and the first moment new homeowners cross the threshold into their new place. We've compiled a list of what buyers should expect when closing on a house, as well as a checklist of tasks buyers should perform before closing day.

What to expect at the closing:

The audience
Buyers might wonder who exactly is going to be present at a closing. The answer depends on what state the closing takes place in. Often, buyers and sellers will both attend the closing. In other situations, buyers and sellers have separate appointments to sign the papers. It is important to note that the closing agent is not a real estate agent. A closing agent might be a title officer, an attorney, an escrow company officer or another qualified, unbiased third party. Buyers and sellers might also have their real estate agents in attendance. Some states require an attorney, who is not also the closing agent, to be there at closings.

Things buyers can't forget
At a closing, buyers need to have a few belongings in their possession in order to allow the process to go by as quickly and efficiently as possible. They should typically bring:

  • Photo ID in the form of a valid driver's license or passport.
  • Proof of insurance. The closing agent needs proof that the buyers have an insurance policy beginning on the date of the closing. They might also need to bring along a receipt showing that the buyers have paid the policy for a full year.
  • Final purchase and sales agreement. If the buyers' agent comes to the closing, they may bring a copy of this contract.
  • Cashier's check. Personal checks do not suffice in making the down payment and closing costs. The closing agent informs buyers ahead of time to whom the check should be payable. If buyers decide to wire the funds instead, they need to do this ahead of time to make sure the bank approves the payment.

Papers to sign
Buyers dread closing day primarily because of the amount of paperwork they need to sign. According to Zillow, just a handful of the documents homebuyers must sign on closing day include:

  • Closing disclosure.
  • Proration papers.
  • Declaration of Reports.
  • Abstract of Title.
  • Statement of Information.
  • Warranty deed.

The closing can take an hour or two, depending on how quickly the process moves along. Once it's over, buyers can take a deep breath, massage their writing hand, which are cramped from signing too many pages. The next step is to move into their home. However, before this process, the buyers should have completed several tasks to prefer for move-in day.

What to do before closing on a house:

Call a locksmith.
Without a new set of keys and locks, new homeowners will have trouble getting into the house. Even if the sellers seem like trustworthy people, they certainly should not have access to a replica key to their former home. Once buyers know the move-in date, they should schedule a locksmith to install new locks a few days ahead. Booking this professional to arrive on the morning of the move-in day could be cutting it too close, in case the locksmith is running late.

Hire movers.
In addition to scheduling a locksmith, buyers need to hire a moving company as soon as possible. Particularly in the busiest moving months, such as June and September, the highest rated companies book up quickly. If the homebuyers plan on moving their furniture themselves, they should still rent a moving truck immediately. Waiting too long might leave buyers stranded or frantically searching for trucks during the days leading up to the move.

Call the utility companies.
Notifying cable, gas and electric companies approximately a month before the move-in day can give these providers enough notice to switch services to the new address. Unless buyers want to spend the first few nights in their new home by candlelight without electricity, heat or Wi-Fi, they should add this task to their to-do list.

Hire painters and contractors.
Buyers who are planning on hiring painters should do so ahead of time. Until the walls are complete, buyers cannot put their furniture into place, preventing their house from feeling like a home until the painting job is complete. Especially if buyers are moving into a fixer-upper, they should start interviewing general contractors ahead of time. To find a trusted contractor, they might ask friends and neighbors, search online reviews and research their previous work. They should ask for cost estimates ahead of time to plan other budgeting accordingly.

For more information about this article, call 866-614-5959.

Buying a home before it hits the market can put buyers ahead of the competition.

How to buy an off-market house

Homebuyers with their eyes on specific homes, or ones who want to be at the front of the line when homeowners make the decision to sell, might try to find their ideal properties before they hit the market. Interested parties might hear about an off-market opportunity through the grapevine, or perhaps they leave a letter in their dream home's mailbox, informing the homeowners of their interest should they decide to sell the property. Just as sellers have different motivations for moving, buyers often have various tactics for pursuing desirable properties. 

In 2016, only 8 percent of home sales in the U.S. were off market, according to the National Association of Realtors. Many people, particularly first-time buyers with limited experience in the real estate market, prefer to use real estate agents and brokers to guide them through the selling and buying processes. This NAR study also reported that 58 percent of "for sale by owner" homes sold in less than two weeks, suggesting that many sellers know their homebuyers. This compares to the overall average days houses spend on the market, which currently adds up to 61 days. Navigating off-market property trends can be difficult, but the buying process accelerates exponentially.

Finding off-market homes
The easiest way to find properties before they officially go on the market is to ask real estate agents if there are any listings they are trying to get. Real estate agents may use prospective buyers to entice sellers to take the leap. Buyers who express interest before the home officially hits the market are typically first in line for showings and offers, since sellers want to speed this process as much as possible.

Homebuyers can find out about for-sale properties before they hit the market by keeping their eyes and ears open for homeowners' life transitions. Parents expecting a child might want to upgrade to a larger home, while those becoming "empty nesters" might plan on downgrading.

Compromising on a price
One component that can make or break the home sale is the asking price. If the seller highballs the buyer, the latter could dismiss the offer. Buyers might lowball the value if they aren't aware of certain home improvements. Both parties need to find a fair price to compromise on.

An effective way to get an accurate estimate is by hiring home appraisers to represent both parties. Once the professionals offer their estimates, the buyers and sellers can average these two figures. If either believes this number does not accurately reflect the home's market value, they can call in a real estate agent.

Calling in professional assistance
Sellers and buyers often consider conducting an off-market transaction to save on a real estate agent's typically 6 percent commission. However, they often hire real estate professionals during this process. Both sides might feel uncertainty about overpaying, in buyers' cases, and underselling, in sellers' cases. Hiring an agent can provide both parties with peace of mind that they are getting the best deal possible.

Real estate personnel have the expertise to establish a home's fair purchase price based on market trends. In a high-demand, low-supply market, the agent might award the sellers with savings. In a high-supply, low-demand market, the buyer might reap the monetary benefits.

Both parties can hire real estate agents for advice in the sale of off-market homes for a single fee. If the agent's role is solely to help them come to a compromise regarding the home's value, they might be paid for a day's work. Buyers might decide to keep agents on to deal with the back-end components of the sale. They might construct the contract, hold a home inspection, perform a title search and prepare the closing disclosure. Since they wouldn't be involved in marketing the home or holding showings and open houses, the 6 percent commission can likely be reduced.

Following instincts
A particularly helpful piece of advice for buyers of off-market homes is to go with their gut. Don't allow the sellers to take advantage of you. If you feel hesitant, call in professional assistance. You might have to pay a small commission in exchange for an agent's services, but the potential risks you could face by pursuing an off-market transaction on your own might not be worth it.

For more information about this article, call 866-614-5959.

Buying an old home means investing in charm in history. However, antique houses aren't right for everyone.

Reasons to buy an old home

When shopping around for a place to live, homebuyers might take the neighborhood, aesthetic and features of a home into consideration. One factor that might seal the deal or scare away prospective buyers is the age of a home. Many people view older homes as a challenge and a steal, while others see these properties as a red flag. Deciding if you should purchase an old home depends on a variety of factors, including a look at the benefits and drawbacks of aged properties.

The median cost of a new home in Jan. 2018 was $329,600, according to the United States Census Bureau. This contrasts the median price of an existing home during this same month, at $240,500, as reported by the National Association of Realtors. Buying an antique house might seem like a cost-effective solution, but with all expenses taken into account, buyers might not make much of a profit off an older property.

What to watch out for in older homes
One reason many homebuyers are hesitant to pursue an old home is the risk of outdated systems. Central air, furnaces, plumbing, electrical components or roofing that haven't been upgraded in a long time can be problematic in older homes. Bankrate noted components that haven't been updated in over a decade to be considered in the pricing of the home. Buyers should add these replacement costs into their budgets if they decide to purchase a house.

The pros of buying an old home
It is important to note some common features associated with older homes. As the expression goes, "They don't make them like they used to." Aged properties tend to have mature landscaping, like vast trees and shrubs. They might have larger yards, as land was cheaper years ago. Older homes may have more character than many new houses in town. Victorians, Tudors, Colonials and other antique styles are unique and charming.

Another substantial benefit of buying an old house is how established the neighborhood is.The Balance contributor and real estate broker-associate Elizabeth Weintraub said older areas are less likely to undergo zoning changes than newer areas. This mean the area probably won't make any possibly undesirable additions to the neighborhood, like chain restaurants or factories. Older properties tend to be situated closer to the center of town, which could potentially put buyers within walking distance of schools, restaurants, shops and supermarkets.

The cons of buying a new home
Purchasing a charming old house can come with some burdens and drawbacks. For instance, older homes tend to have smaller closets, garages and bathrooms than houses built in the last two decades. Old houses are generally more compact than new ones. Perhaps new homes' larger sizes are to accommodate more material items and larger family sizes of the 21st century. Since the foundations and floors have aged, the house might require more maintenance, such as keeping the floors from sloping and the chimney from corroding. Unless the previous owners took it upon themselves to renovate the home's interior, buyers might need to upgrade the kitchen to keep it from looking antiquated.

For more information about this article, call 866-614-5959.

Mistakes to avoid as a first-time homebuyer

Mistakes to avoid as a first-time homebuyer

The home buying process can be extremely complicated and occasionally drawn out, even for shoppers who have been through it before. As a result, it's understandable that first-timers would have more difficulty in dealing with these issues, and can occasionally make mistakes. Fortunately, it doesn't have to be that way.

There are plenty of common mistakes among first-time buyers but most of those are extremely avoidable. Here are just a few:

Aiming too high

One of the biggest issues for first-timers is believing they can afford to buy a more expensive house than is reasonable based on their finances, according to NerdWallet. Before getting into the market, it's important to crunch the numbers, pay down debts, build savings and doing all the basic legwork of determining exactly "how much home" they can afford.

Trying to save up front

One of the ways in which people make a long-term mistake when buying a home is keeping the size of the down payment low just to get a sale completed, NerdWallet noted. While there are certain situations where that strategy makes sense, lower down payments lead to more interest charges in the future. While it may seem like a good idea to save a few thousand dollars now, one must keep in mind that the difference can add up to tens of thousands over the life of a loan.

Not getting pre-approval

One way for shoppers to avoid targeting homes that aren't actually affordable, and to expedite the bidding and sales process when they find something they like, is to get pre-approved for a mortgage, according to Investopedia. By doing so, they will know exactly how much credit lenders are willing to extend them, and really lock themselves into a deal that makes sense for them.

Overlooking other costs

Ongoing homeownership costs aren't just the mortgage itself, Investopedia added. They may also include mortgage insurance payments (which go away after a while), increased utilities costs in many cases, homeowners insurance and so on. Furthermore, buyers should always budget for the thousands of dollars they're likely to face in closing costs.

Not doing homework

While it's tempting to dive headlong into the market, finding a lender and real estate agent as quickly as possible, that's not a good idea, according to U.S. News and World Report. It's always a good idea to shop around for the best possible deal on a home loan, and to find agents who have experience helping people in similar situations find something that works.

Falling in love with a home

Finally, people who really get excited about buying a specific home may get themselves into trouble when it comes to overbidding, U.S. News and World Report pointed out. Especially in today's market, most homes for sale are going to receive a lot of attention, and it can hurt for sellers to go with another shopper's bid. Unfortunately, that's life in today's real estate sector.

Working with a qualified and experienced real estate professional will help first-timers avoid these common pitfalls, and the same is true of finding the right lender.

For more information about this article, call 866-614-5959.

Listing and selling agents offer helpful expertise to homebuyers and sellers.

What’s the difference between a listing agent and selling agent?

Home sellers and homebuyers might work directly with listing and selling agents. Although people often use these terms interchangeably, these two types of real estate agents serve different purposes.

Listing agents
Sometimes in television shows and movies, a real estate agent will bake cookies in a home immediately before an open house to leave the space with comforting, mouth-watering scents. This individual is known in the real estate world as the listing agent. This agent is in charge of helping home sellers market their properties. According to the National Association of Realtors, 89 percent of home sellers used real estate agents in 2016.

These agents help sellers put their homes on the market for competitive prices. They usually have expertise regarding the current housing market in the area. They have access to up-to-date information about how similar properties in the same neighborhood and town have sold in recent years. This database might include exact costs, the amount of time homes spent on the market before closing and what deterred buyers from making offers. With this information, listing agents can provide guidance and advice on how they can work with sellers to sell the home.

Listing agents might be involved in staging the homes they are trying to sell. This might include baking sweet-smelling treats or adorning the living room with fresh, eye-catching pillows. Listing agents understand how something as simple as the room's color scheme can subconsciously interfere with prospective buyers' perceptions of the place. They know the importance of creating a space that looks polished and homelike, where buyers can envision themselves living.

Once listing agents begin holding open houses, they will keep in touch with buyers who are interested in making serious offers. After homes sell, listing agents will walk the homeowner through any paperwork associated with closing on the property. Listing agents typically receive a specific percentage commission on the sale price of the home. This amount gets split with the selling agent and the selling and listing brokers.

Selling agents
These real estate professionals work on the other end, assisting prospective homebuyers through the process. Sometimes they are known as buying agents before any contracts come into play and as selling agents during the negotiation period, according to Bankrate. NAR calculated that 87 percent of buyers used selling agents in 2016, a number that climbed from 2001's 69 percent.

The work that selling agents perform differs from what listing agents do. They search for properties that fit their clients' needs, set up showings with the listing agent, communicate with the sellers regarding buyers' offers and walk buyers through the offer process. If you've ever seen House Hunters on HGTV, you might understand selling agents' duties.

Deciding if listing and selling agents are necessary
Some buyers and sellers choose not to use representation. They might decide to go house hunting independently or put their homes on the market without an expert's guidance. However, many people find that hiring professionals saves them a lot of legwork. In addition, some listing agents will take offers seriously only if they come through selling agents.

Before hiring a listing or selling agent, it is imperative to speak with multiple agents. References from past clients, their experience in the town or neighborhood and even their personality and temperament are crucial factors to consider when choosing the right agent.

For more information about this article, call 866-614-5959.

How much home is 'too much?'

How much home is ‘too much?’

Cost is perhaps the most important consideration when it comes to buying a home because of just how much people have to invest – both up front and over the course of decades – in making a purchase. Typically, this is going to be the single most expensive purchase of a person's life, and it looms large over personal finances for years. As such, it's important for buyers to make sure they're buying a home they can actually afford, and are careful to avoid talking themselves into buying "too much house."

There are a few basic rules of thumb that will help people avoid buying a home they can't really afford, and the simplest one is to set a hard and fast line, according to personal finance expert Dave Ramsey. As with anything else in the mortgage process, it's important to crunch the numbers and determine how much the monthly mortgage payment would be for any given home, based on the size of a buyer's down payment. If the mortgage payment exceeds 25-28 percent of their take-home pay, that's probably too expensive for shoppers to really afford.

It's worth noting, of course, that higher down payments will lead to lower mortgage payments going forward, and can end up saving homeowners five figures over the life of a loan thanks to reduced interest charges and so on, the report said. But if that's not an option in a short period of time, homeowners would be wise to move on to more affordably priced properties in their home search.

Doing the math
Of course, that homework doesn't have to be done for each individual property – and in fact, it shouldn't be, according to Forbes. Instead, would-be homeowners are likely to be better off if they do all that math before they even start shopping, and then seek pre-approval on a mortgage. Working with financial professionals will help them determine exactly what's affordable based on factors such as their debt-to-income ratio and down payment size, and that will inform decisions about the price range they should be shopping in.

Often, it's a good idea to pay down existing high-interest debts like credit card balances before starting the mortgage process at all, because this not only frees up some money every month that can go toward savings instead, but also makes applicants more attractive to lenders overall.

Avoiding a classic mistake
One of the issues that is all too common in the housing market, which any financial or real estate professional would warn against, is shoppers falling in love with a house and deciding they will exceed their carefully calculated limits to buy it, according to The Motley Fool. It's up to each individual to determine what they're comfortable with, of course, but avoiding that temptation to go above and beyond what they've determined is the most reasonable price point is vital to keeping a mortgage affordable for years to come.

With all that in mind, working carefully with a real estate agent or financial professional is vital to people understanding exactly what makes sense for them, especially if they're first-time buyers.

For more information about this article, call 866-614-5959.