COURSE INDEXPreliminary Questions
Home Buying Start & Registration
Budgeting To Buy a Home
Find Your First House
Inspect Before You Buy
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Home Mortgage Loan Process
Credit Score and Credit Report
Home Mortgage Loan Closing
Being a Home Owner
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Hernandez Net Monthly Income: $4,750.00
(Less) Monthly Expenses: 4,230.00
Net Savings: $ 520.00
Upon evaluating their net savings, Juan, Rita and Mom decided they would have to make some adjustments in their lives if they were going to purchase a new home. They were looking at buying a newly built home, so their initial maintenance would be less than on their current older home. Their utilities would stay about the same, since they were looking at a larger home. Even though it would be more energy efficient, the size would make up the difference. The $520 plus $300 maintenance would allow them a monthly payment of $820. This monthly payment would have to include the hazard insurance and real estate taxes. Their budget planning made them realize how much they were spending in miscellaneous, cash, and entertainment and that if they wanted a new home, they could cut down on some of their frivolous spending and have more money to apply to a new house payment. The amount of pocket cash used each month alerted them to the need for a much more careful analysis of where that pocket cash money was going and how they could make better use of it, or better yet cut down on it. They decided to limit their entertainment spending to $300 per month; out of pocket cash spending to $200 per month; and if they were not spending as much on entertainment, then their monthly child care expense would also automatically decrease. They decided to discipline themselves to not spending more than $350 per month on childcare.
With these reductions in their spending habits, they could have added flexibility of $350 per month to apply to a house payment or expenses of buying new items for their new house. They now could look at up to $1170 per month in a house mortgage payment.
They called a Realtor to list their house immediately, and began looking at plans and specifications with a builder to get the exact house they wanted.
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Table of Contents | Homebuyer Course Start Page | Find A Realtor | Budgeting To Buy a Home | Neighborhoods | Find Your First House | Inspect Before You Buy | Shop For a Mortgage Loan | Mortgage Home Loan Process | Credit Score and Credit Report | Home Mortgage Loan Closing | Being a Home Owner
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