You have decided, it is time to purchase your first house. You are tired of seeing your rent payments gone with no personal equity. Where do you start the process of buying your first house? The first step is to ascertain how much house you can afford. This is actually pretty simple.

First and foremost, your housing cost should not exceed more than 30% of your disposable (after tax and deductions) income. Example:
your income is $60,000 per year, times 30% equals $18,000 divided by 12 equals $1500 per month maximum housing cost. Here, my suggestion is to stay on the low end of your housing cost and, if your household has two incomes (husband and wife), only calculate your housing cost on
one income. Why one income? The reason is that if one is laid off or loses their job, your housing cost will not break your budget due to decreased income. Keep in mind your housing cost will have to cover your mortgage payments, taxes, insurance and repairs.

Next, consider whether you can come up with a down payment. This will be extremely important as you seek financing of the remainder of the selling price of any home. When you have done these preliminary tasks, you can go to a lender to apply for preapproval of your mortgage you will need to carry. The lender will tell you how much house you can afford, how much they are willing to lend you and what your approximate monthly payments will be. If you are asked what term mortgage (30 years, 40 years,) you would prefer by the lender, request the longest term the lender offers. You can always make extra principal payments with additional income. This is particularly good for you at the beginning of the mortgage payments because it reduces your interest payments immediately.

OK, now armed with good ideas of how much house you can afford, it is time to start actually looking for “the” house. One of your primary considerations here will be the number of bedrooms if there are children or others that comprise your family and the possibility that your family could grow in size. Take your time and evaluate the selling price of each house you tour. Usually each home for sale will offer a brochure outlining the amenities the home contains. The brochure should also give you property tax info. You may have to make some concessions about the amenities you desire just to get into the price range you can afford.

Looking for “the” house should be fun but a knowledge gaining experience. When you get to the point where you have narrowed your search down to 2 or 3 homes, it is time to do another tour of each to determine which sellers to submit offers to. Take your camera with you. The second tour should be a time to ask questions about items not exposed in the home’s brochure and other issues.

It may be prudent to hire an attorney to help you with the offers. The reason I say this is because realtors, in general, represent the seller and an attorney will give you some leverage; the attorney will represent you, making negotiations fairer for you.

To conclude the process of buying your first house get an exceptional guide to explore the things the realtor will not reveal: Guide To Buying Your First House.

As you become familiar with your first old house, you will find ways to correct the inperfections. This article will demonstrate just some ideas on what you can do. Most of the following ideas are inexpensive. After all, following the purchase of your first house, there is not much money left.

Your house is bare. Your furniture that more than filled your apartment now is not enough for the space you have. Rummage sales may provide some answers to your barren dilemma. Prices at rummage sales can be negotiated and you may walk away with a real find. Also, check out framed pictures at rummage sales because, you may not like the current picture, but it can be changed to something that is more in tune with your liking. New picture frames are very expensive.

Check the attic of your new old home. Did you find anything which you could use? I found the shade of a Tiffany type lamp which most people would have tossed because the shade was falling apart. I took it to a shop and had the soldering repaired, then to a small lamp repair shop where they teamed the shade with an appropriate base. Although not a stamped Tiffany lamp, it fits into the scheme of my front porch and the period of the home very elegantly. Another find in the attic was a small short, wood table. After refinishing it, I found it fit perfectly at the end of an 11 foot counter in the kitchen. I use it to house my answering machine and phone. It is absolutely amazing the things former owners will leave behind.

Another change I made was replacing the dining room light fixture to blend into the period of the house (1926). The crystal chandelier that adorns the dining room was one of the smallest ones the lighting store had available but it is perfect for the room and matches the period of the home.

Storage can be a real problem, especially in older homes. Seems there is never enough places to neatly store everything. Let’s look at your garage (if you have one). A one-car garage has immense problems when considering storage. I found big hooks at Hobo and, somehow, have stored everything from car to gardening stakes and more in my very small garage. When our Wisconsin seasons change, I even trade tools from the back of the garage to the front for easy access.

Finally, basement storage can be a large problem. They usually are not large enough and can be subject to flooding. Nothing worse than discovering a cardboard box left on the basement floor is now swimming. So, get yourself some wood cross arms (3) and three boards 2 ft X 8 ft X 1/2″ thick and make yourself a great storage rack. (See diagram) Don’t forget that you must screw the boards to the crossarms. You might even find the cross arms at a warehouse which is no longer using this kind of shelving for storage. Keeps everything on it off the floor.

If your doorbells are not working, make an appointment with an electrician to have them repaired. When approaching the front door of a home, you never know if the doorbell is working or not. Therefore, it is your responsibility to make sure it works. This is not an expensive repair. If you are home alone with washing facilities in the basement, you may want the electrician to also install your doorbell in your basement.

Other ideas for improvements are stenciling wall borders or just paper wall borders, changing wall colors, install new weights and rope in double hung windows, security lighting, bathroom medicine unit over sink, new caulking, decorative lighting, renovating light fixtures, add undercabinet lights and decorative artificial foliage and flowers.

“Right now, is the best time in history to buy a house in America.”

If your mortgage is at a very large bank, you have made a mistake!  Trying to work out a solution to your deficiency is very complicated and the service is lousy.

Obviously, not being able to pay your mortgage payment is a very serious situation and should be avoided at all costs, even to the point of putting the property up for sale.  You will not see a penny of your equity should you allow your lender to foreclose.  It is also very important that your mortgage lender is local.

Renting is a great alternative to buying except in our current economy environment. Once you pay your rent, the money is gone, spent! As a general rule, personal privacy falls to the wayside when renting. Your rent will probably not buy as much as your mortgage payments will.

On the other side, the status of our economy couldn’t be better to consider buying your own house. “Homes For Sale” inventories are high, interest rates at an all-time low, government assistance is available and sellers are anxious to sell their homes.

I feel really strong about buying your first house when you are young. At first, you may find that home ownership is a struggle but this struggle will lessen as time goes on. This assumes you will have a fixed rate mortgage and wages will increase over time). When you get to retirement, you will probably will have your home paid for which will enhance your financial position as you try to make it on your retirement income. Retirement income tends to be fixed and does not keep up with the rate of inflation (rises in costs of living).

Just keeping a roof over your head is one of the many reasons buying your first house satisfies, what’s in buying a house for you!