Property Rights Law Firm, P.A.

Preparing to buy a home?

Prospective home buyers are normally encouraged to save up to 20 percent of the anticipated purchase price for their residential property. However, not having the 20 percent saved doesn't necessarily preclude anyone from being able to move forward with homeownership in Florida.

It's important to assess the personal finance situation. Weighing the difference between monthly mortgage payments with the 20 percent down payment available versus applying a lower down payment is strongly recommended. Realistically, if putting 20 percent down, mortgage insurance is required, and that increases the monthly mortgage. It's important to understand just how much can be allocated monthly toward household expenses. Homeownership might not be a possibility if one is having a difficult time managing current household expenses. It may be necessary to consider how other aspects of one's financial life such as education or retirement savings plans would be affected.

Prospective buyers might consider a scenario where they decide to move into a less expensive space to rent while saving for a new home. Although the rent is less expensive, individuals should factor in moving expenses like deposits, storage and movers when relocating. They might find that saving for the private mortgage insurance and preparing to buy a home may be the better option financially.

Once an individual has settled into the idea of homeownership, they should consider what the ongoing finances will look like. Avoiding overextending a budget should be the primary objective for a household. No more than 30 percent of the gross monthly income should be allocated toward household expenses. The homeowner should have ample cash reserves on hand for any emergency.

For those preparing to buy a home, a real estate attorney may be able to assist with resolving title issues, the real estate closing and any contract terms. A real estate attorney who has in-depth knowledge of zoning laws and short sale transactions may help find the right subdivision and monitor any residential development opportunities available in a desired area.

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