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Fidelity Bank & Trust offers practical advice to keep you on track when buying a home.

Publish Date: June 2023

June is National Homeownership Month! As Your Hometown Bank, we celebrate the importance of homeownership and the opportunity it provides in the communities we call home.

“Buying a house is a major investment and it is important to be financially prepared,” said Pauline Shatek (NMLS# 507801), Vice President of Retail Loans at Fidelity Bank & Trust (NMLS ID# 460971). “We’re here to help you through the homeownership process from start to finish!” added Pauline.

Before you hit the road or the search bar, Pauline encourages you to take these home buying tips into consideration:

UNDERSTAND YOUR MONTHLY EXPENSES
Many don’t have a true understanding of what they are spending each month, but it’s also the only way to get a true picture of what you can afford. Track your spending so you can understand what expenses may be unnecessary. If you don’t want to track your expenses manually, there are apps out there that can help!
KNOW WHAT YOU CAN AFFORD
Now that you have a clear picture of your expenses, next, you should consider the income for each person contributing to the home. Subtract your monthly expenses from your ‘take home’ (after tax) income to determine the amount you have available. Find a mortgage lender to have a more robust conversation about what you can afford and get prequalified. They can provide additional guidance on your debt-to-income ratio and what that should look like for buying a home.
BE REALISTIC
Once you have determined what you can afford and are prequalified for a mortgage, be sure to stick to your price range! We suggest not even going into homes that are out of your price range, or you may kick yourself later if you feel straddled with a home you can’t truly afford. Also, be realistic if you’re investing in a fixer upper. While they are fun to watch on TV, if you don’t have the skillset to actually complete a renovation, it’s likely not for you.
ELIMINATE OTHER DEBTS
Boost your credit score by paying down the debt you have and stay away from other big purchases until after your home closing. This will make sure your credit score is in tip-top shape so you can get the best rate on your mortgage.
PROVIDE A STRONG DOWNPAYMENT
The more you are able to give for a down payment, the greater equity you will already have in the home in addition to a lower monthly payment. This will save you money on interest in the long run. If this isn’t realistic for you, we’re happy to discuss lower down payment options.
TAKE YOUR TIME & UNDERSTAND HOMEBUYING EXPENSES
Don’t let your desire and excitement for a new home cloud your judgement. Take the time you need when shopping and be realistic about the new responsibilities you will have as a homeowner. Make sure you are prepared for unexpected expenses and the responsibility of additional upkeep.

If the house you want is out of your price range, set some savings goals to make it a reality. Consider what expenses can be cut in addition to how you can bring in more income.

Be smart with your finances and don’t spend all your money on a “dream home.” As Your Hometown Bank, we’re here to help you know how much house you can afford, while offering mortgage solutions to fit your needs. Find your mortgage lender today!