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New Home Loan Problem Solving: Research the Market and Get Creative
by Gabriel Traverso
CMR Columnist
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Many would-be homebuyers in California struggle over high home prices and the difficulty in getting a down payment together for their new home loan. Clearing these obstacles and getting into your first home requires work and creativity.
Your First Mortgage: Find the Right Neighborhood
In some areas of California, more affordable homes aren't moving and sellers are cutting prices--by as much as $60,000! You want to buy a new home; be realistic and research neighborhoods carefully to find an area you can afford and use an online mortgage calculator to find out exactly how much new home you can afford. A mortgage calculator helps you determine if the neighborhood you want fits in your price range, and most mortgage calculators let you enter amounts for rates, taxes, and insurance so that you can account for all the costs of homeownership.
Getting Your Down Payment Together for a New Home Loan
When it comes to buying your first home, the down payment often seems to be an insurmountable obstacle--but there are ways over the hump. Did you know that you can take money out of a qualified pension plan, such as a 401(k), and use it for a down payment to buy a new home without getting hit with a tax penalty? If you have an IRA, 401(k), or other plan you should contact your administrator and find out more. You can also take out more than one mortgage to get into your new home--talk with a few mortgage lenders to see what options might work for you. Lastly, have you asked your family for help? You might find that they might be able to loan you the money to help you qualify for your new home loan.
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About the Author
Gabriel Traverso is a freelance writer, professional musician, and artist. He resides with his family in Reno, NV.
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