Useful tips for the first time home buyer

Buying a home is a very important decision which needs time to think over and a lot of calculations done before finalizing a home. There are so many things to consider before you can actually pay for a home that you have liked. First there is the huge task of combing through all the homes possible for you to see and then arranging for mortgage.

If you are a first time home buyer, here are a few first time home buyer mortgage tips:

• Once you have decided on which home you want to buy, you would want to look for a reliable realtor. Your realtor will guide you through the steps of buying a home and all the necessary paper works and also contact with the mortgage lender.

• You may prepare a budget and see where your money is going. Accordingly you can settle on the amount to be set aside for your mortgage. This is the best way to find out how much mortgage you can afford. You wouldn't want to buy a house that you cannot afford.

• One thing you must remember is that do not pay more than 30% of your net monthly income as mortgage payment each month. Do not over extend yourself financially. Give only as much as you can.

• Your mortgage payments each month may include property taxes. You may speak with the property office at your local courthouse to find out what is the local property tax rate. Since you are a first time buyer, mortgage may be a new thing for you. But your agent can take you through the process and you just have to stay alert.

• Another tip is to remember that in some cases you can add your property insurance to your mortgage payments.

• Find out the type of mortgage you are looking for. For a first time buyer mortgage, a fixed rated mortgage would be a wise idea since adjustable rate mortgages start with a very low interest.

• The fees that your realtor will receive will be included in the total cost of your home. This will raise your monthly mortgage payments unless you pay them directly.

• There may be hidden costs added to your mortgage like the closing costs. In some areas the seller can be persuaded to pay the closing costs or you may have to pay it upfront. You must find out from your mortgage company about how much closing costs you will have to pay. This way you can plan accordingly.

• You may check federal and state programs that may be available for first time home buyers. You may check these because many a times they guarantee a portion of your loan or enable you to get a loan without making any down payments.