Consumers United Association Newsletter

March 2006

in this issue Renting vs. Buying It's Time to Buy a Home Getting Credit-Ready Saving for Your Down Payment How Much Home Can You Afford? Pre-qualifying or Getting Pre-approval for a Mortgage Listen to the Interview Greetings! If you missed the opportunity to hear our radio interview about buying a home, we have posted the interview on our website. This issue of Consumer Voice also highlights points in the interview and provides more information on this subject. Renee Beauregard, Executive Director Renting vs. Buying Purchasing a home is a big decision and one that should not be taken lightly. There are many financial factors to consider before buying a home. While there are advantages to purchasing a home, for some renting may be the best financial option. Read On: Renting vs. Buying It's Time to Buy a Home Oftentimes the decision to consider buying a home is followed by finding a realtor and going shopping for a home. When you do this, you are taking a risk of purchasing much more home than you can afford. There is also the potential for complete discouragement if you find a home that you really want and cannot afford it. When this happens, it is difficult to “settle” for something smaller. Read On: It's Time to Buy a Home Getting Credit-Ready The three major credit bureaus have recently decided to utilize a uniform credit scoring system, which will take effect later this year. As the system operates today, credit scores run from 300-850 (under the new system, scores will range from 501-990). Lenders base the percentage rate they will offer you for your mortgage on your credit score. The higher your score, the better mortgage rate you can obtain. Read On: Getting Credit-Ready Saving for Your Down Payment Lenders often require a down payment ranging from 0- 20%. Saving for a down payment can sometimes be a daunting task. Read on: Saving for Your Down Payment How Much Home Can You Afford? Your mortgage and associated costs should not exceed 28 percent of your gross monthly income. This includes mortgage principal and interest, real estate taxes and homeowner's insurance, the usual items included in a monthly mortgage payment. Your total debt should not exceed 36 percent. Read on: How Much Home Can You Afford? Pre-qualifying or Getting Pre-approval for a Mortgage When you are shopping for a home, one advantage you can have over others interested in the same home is a pre-approved loan. Having pre-approval means the seller doesn’t have to wait for you to get qualified, as opposed to other buyers who still need to go through the process. This could even give you room to negotiate the price of the home. Read On: Pre-qualifying or Getting Pre-approval for a Mortgage Listen to the Interview Listen to our recent interview about buying a home. Thanks to Jefferson Pilot Communications and their affiliated radio stations for covering this important topic. Listen to the Interview Quick Links... Avoid Predatory Mortgage Loans Mortgage Financing Options More About Us Our Sponsors

email: cua@cuacolorado.org phone: 303-400-3456 web: http://www.cuacolorado.org