How much house can I afford to buy in Highland Park CA?
Buying a home in Highland Park CA or anywhere else on the Eastside of Los Angeles can be very exciting. It’s overwhelming to most homebuyers all of those years window shopping open houses to then finally come to life with having a preapproval letter in your hand and a Highland Park expert buyers real estate agent by your side opening the for sale home doors for you. See, you’re one of the smart homebuyers who went through the pre-approval mortgage loan process with a trusted lender before you had a real estate agent set up the first property tour.
The Eastside of Los Angeles, specifically Highland Park, is exploding with new businesses and homes for sale which makes it easy to get caught up in the open house scene before you even stop to ask yourself the most important first question: How much house can I afford to buy in Highland Park CA?
It doesn’t really matter how beautiful the kitchen cabinets are, or the master bathroom, or even the backyard with a view of the Mount Washington hills. If you can’t afford the mortgage including PITI each month or the down payment or closing fees it doesn’t matter anyway because the house isn’t the right house for you.
Save yourself the frustration of looking at homes for sale in Highland Park, CA that is too big a piece to chew. Here are some tips to make your home buying process a lot smoother and dare I say, fun?
Talking with a Mortgage Broker or Direct Lender is the first step
A talented mortgage broker should be able to crunch your financials and other documents like tax returns and a credit report in a single day to give you a good idea of your first time home buying power or your dream home budget. Check out the steps below for a better idea of what your lender will be doing behind the scenes.
How much money do you bring home each month?
Tally up your paychecks. Are you buying a house with your partner or someone else? Let’s say you earn $7,000.00 a month and your domestic partner brings home $4,800.00 a month. Your total income would be $11,800.00. a month.
Go ahead and multiply your gross take-home pay by 40-45% to get to your maximum monthly mortgage payment (although that figure does vary from lender to lender.)
By following this rule of thumb, if you bring $11,800.00 into your home each month, that means your maximum mortgage payment shouldn’t be more than $5,310.00 a month. Remember, this is only an estimate and you’ll still need to factor in homeowners insurance and property taxes.
Wait. What about other home ownership costs?
Now you’ve closed escrow and you’re in your new home. Don’t get caught in the trap thinking your home mortgage is the only monthly payment you’ll need to keep the lights on. Oh, right, keeping the lights on is another bill! Besides the lights, you’ll have utility bills, ongoing property maintenance, and repair, and let’s not forget you’ll need furniture in your new home. Gosh, how these bills add up.
Let’s back up and talk about a home down payments.
Any smart mortgage broker or seasoned real estate agent will tell you your home downpayment will play an essential role in how much Highland Park home you can afford. The more money you use as a down payment the less you’ll need to finance which means your mortgage will be less. Another way to say this is, the less you owe the faster your home could be paid off, the less interest you’ll pay, and one day you’ll own the house free and clear. How do you like them apples?
Of course, paying cash for your home purchase would be ideal but if you’re like me, I had to finance my house. Ideally, you’ll want to put 10% or more as a down payment and there are plenty of loan options out their perfect for your specific situation. Again, this is why it’s critical you work with a savvy expert mortgage broker who can help guide you towards a mortgage program uniquely tailored just for you.
Work with a Highland Park or Eastside of L.A. Expert Buyer’s Agent.
Nowadays everyone starts their home search online either in front of their laptop or smartphone scrolling through the real estate websites like Zillow, Trulia, Redfin… ETC and now even the gimmicky websites like Open Listings. Just because your home search starts online it shouldn’t end there. You do a lot of your own research but it’s critical you seek out help from an expert real estate professional who services the area you are interested in buying a home when it’s time to get serious about homeownership. A top real estate agent in Highland Park who works in all of the Eastside communities will help you pair up with a skilled mortgage broker or direct lender and guide you to the right properties that not only fit your budget and lifestyle but get you the best bang for your buck.
A good real estate buyers agent will also help you reimage property elements and talk you through the other expenses of homeownership. Sometimes you get the house you want and it’s not perfect, so you can break down the property improvements into phases.
Wow. A Buyers Agent sounds great. How do they get paid?
Here is the best part for you as a homebuyer. You pay your buyers agent absolutely nothing! The seller pays your buyer’s agent fee. How that works is the listing agent shares a portion of the listing fee with the buyer’s agent.
How do I hire the best Highland Park Buyer’s Realtor?
You may know a buyer’s Realtor. Almost everyone in Highland Park, CA knows a real estate agent or knows somebody who knows a real estate agent so how do you make sure you’re working with the right Agent? Keep in mind only a small percentage of real estate agents are highly skilled and bring expert knowledge to the table. You want to work with an agent who can not only show you a home, but knows the ins and outs of a property, and a true rock star agent will have the following:
- Three to five years or longer of full-time real estate experience
- Dozens of sales or more each calendar year
- Proven track record-breaking price records on the listing side (working with sellers) and saving money on the seller side (working with buyers)
- Online past client reviews
- A team of vendors, contractors, and handymen at your disposal
- Your agent should be available to you 7 days a week
- A Highland Park and Eastside of Los Angeles neighborhood expert
- An attitude and approach to business that makes you feel as if you’re their only client
A real estate professional won’t shy away from a difficult conversation and aren’t afraid to ask the seller for credits or a price reduction and also knows how to communicate efficiently and effectively with the other agent or broker involved in a transaction to get a deal done.
If you’re serious about homeownership and want to partner up with a winning team that is more concerned about you get what you want for a great price and deal and not about their paycheck The Shelhamer Group would love to chat with you about current market conditions and our proven home sales track record and satisfied clients.
Joe Tishkoff from Finance of America disclaimer: NMLS #240232
© Finance of America Mortgage LLC is licensed nationwide | NMLS ID #1071 (www.nmlsconsumeraccess.org)300 Welsh Road, Building 5, Horsham, PA 19044 | (800) 355-5626 | AZ Mortgage Banker License #0910184 Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act Georgia Residential Mortgage Licensee #15499 | Illinois Residential Mortgage Licensee | Kansas Licensed Mortgage Company Licensed by N.J. Department of Banking and Insurance | Licensed Mortgage Banker — NYS Banking Department | Rhode Island Licensed Lender