#3 Apply for the Loan
You have all your paperwork in order get it to the lender who most fills your needs and apply for a loan to see what you qualify for. I know you will want to start looking at homes on the internet or go to open houses but DON’T. Until you know what amount you qualify for do not randomly go house shopping, you only set yourself up for disappointment as most of us have tastes that exceed our pocket books.
Once your lender qualifies you be sure to look at the monthly payment amount to see if it fits in plan that you are comfortable with. Many people qualify for MORE than they can afford to pay back monthly comfortably because of excitement. Remember the lender is probably quoting you payments of P I That is Principle and interest, you will still have taxes and insurance built into your monthly payment to consider PITI is Principle, Interest, Taxes and Insurance. These numbers can be estimated depending on the annual tax rate of the area and home size you are considering and an estimate from your insurance agent on annual home owners insurance.
So NOW you have a loan you are qualified for AND feel comfortable paying the mortgage of, you have the money in the bank you need to pay for any up front costs, NOW lets start looking?
See more in our Buying a home series
How to buy a home -The Inspection
How to buy a home -The Closing