4 Factors To Consider Before Buying A House In Austin

4 Factors To Consider Before Buying A House In Austin

Every American family dreams of owning a home. For a resident of Texas, buying a house in Austin means an investment of a lifetime. Though the mortgage rates have gone and home prices have dropped nationally, in Austin they are a bit up. As home prices are likely to rise again in the near future, this is the right time for buying a house in Austin. Recently, HomeAway Incorporation, a company in Austin, which operates the largest network of websites, for people wanting to sell or rent vacation homes, made its 3rd acquisition with the purchase of a Colorado software company. Before buying a house in Austin, there are certain factors one needs to consider. These are as follows: 1. Affordability: This is the most important aspect for a first time home buyer. Before going to a lender, one should determine his affordability in repaying the loan. To find out the affordability, one can take help of online mortgage calculators. The calculators determine the total monthly repayment for the loan amount one intends to take. Apart from the monthly payments, one also needs to consider other charges like, origination costs, down payment, insurance, tax, closing costs, etc. It advisable to take a loan whose repayment amount will not make the borrower's financial life unstable. 2. Mortgage type: The borrower needs to select a mortgage type in such way, which will not have any adverse effect on his financial life. If someone wants to pay a fixed sum every month, he can opt for a fixed rate mortgage. Whereas, if someone wants to make payments in accordance with the fluctuating market index, he can go for an adjustable-rate mortgage. One can also combine these two and opt for a hybrid mortgage. Apart from these two types, there are several other mortgages, like balloon mortgage, jumbo mortgage, interest-only mortgage, and many more. One needs to have a full understanding of the different loan types, before choosing one the most suitable one. 3. Loan term: If someone wants to have low monthly payments, he can go for a 30-year mortgage. However, if one wants to build home equity within a short time, he has to pay higher repayment amount. In that case, he should opt for a 15-year mortgage. For a 30-year loan term, the interest rate will be lower. 4. Debt-to-income ratio: One should have a good debt-to-income ratio, to get favorable terms and conditions on the mortgage. It is essential to have a good credit report.

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