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Last Updated: Jul 2nd, 2008 - 21:15:22 |
(NAPSI)-No matter what state the housing market is in, home- buyers would be smart to remember a simple tip: Experts say not to spend more than two and a half times your income on a house.
Sticking to that rule can help keep your mortgage payments affordable and keep you from being "house poor."
Here are a few additional tips for finding a home that you can afford:
• Keep An Eye Out For ARMS-Adjustable-Rate Mortgages, or ARMS, have monthly payments that could eventually adjust with the market.
Unless you definitely plan to move in just a few years, look for fixed-rate loans in which the interest rate is set for the life of the loan.
• Beware Of Interest Only-Interest-only loans are ticking time bombs of debt. Why? You pay only the interest on the loan and not the principal.
• Avoid Debt-Being able to borrow money isn't the same as being able to afford it. Before you buy a house, remember additional expenses that could be tacked on to mortgage payments-things such as property taxes, utilities, maintenance and homeowner's insurance costs.
Protecting Your Investment
Once you purchase a home, take steps to protect the investment with the right insurance. Kiplinger's says life insurance is a must for homeowners. It recommends buying inexpensive term policies. But you might be able to cut insurance costs further by combining all your policies-life, auto and home-under one company.
Remember to shop around, too. Insurance rates can vary from company to company, so it could be worth your while to see what's out there before making a purchasing decision. The Web is a great resource for comparison shopping, with some sites even giving you several quotes from different insurance companies at once.
Finally, whether you own a home or are shopping for one, it's important to understand how to take control of your financial life. To get a copy of "How Money Works," write to Primerica, 3120 Breckinridge Blvd., Duluth, GA 30099, ATTN: Corporate Relations, or call (770) 564-6329. For more information, visit www.primerica.com.
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