As we start the New Year, there is much to be considered about our personal financial habits and the future of our mortgages. Whether you are buying, selling or just trying to avoid foreclosure, there are some things you can do to make 2013 a financially healthy year for home ownership.
If you are looking to buy a home in the New Year you are in a unique position. It is definitely a buyers’ market and getting a good deal on a mortgage loan is easier than in years past. However, don’t rush into a contract just yet. Be sure you have done your homework on what neighborhoods have kept up their resale values, how much you can realistically afford to spend on a home purchase and whether you are prepared for the full costs of home ownership. Choose a home that you can afford by keeping your mortgage payment below 30% of your gross monthly income, while also factoring in the costs for insurance and repairs.
If you are looking to sell your home this year, you may be faced with some additional challenges. Remember that your home may not be worth what it was a few years ago, or even what you may consider fair market value, right now. Consider whether you truly need to move or whether you can renovate, rent or simply wait a few months to see what the market does value wise. If you do need to sell now, know your bottom dollar and be patient in this turbulent market. If you are experiencing financial troubles, talk to your lender about a short sale or other options to help you resolve before foreclosure strikes.
If you plan to stay put this year then you have several options. If your budget allows, consider making an extra mortgage payment this year. Put away a little extra each month and make an extra payment by the end of the year to help chip away at your current loan. Look into refinancing to see about lowering your rate and saving you money in monthly payments. Otherwise, keep your home in good condition and protect the value of your investment by catching the minor need for repairs early before they spiral into a bigger project.