NeighborWorks News

Is Homeownership Right For Me?

Is Homeownership Right For Me?

Katie Batterbee - Tuesday, February 20, 2018

Should I rent or buy?

The decision to rent or buy depends on your financial situation, your lifestyle, how long you expect to remain in a certain area, the prevailing mortgage rates and rents in your area, and many other factors.

If you’re a renter, it can be frustrating to write a rent check every month and have no home equity to show for it at the end of the year. But if you aren’t certain that you’re going to stay put for a few years, it’s probably not the right time to buy—equity or no equity. You should not buy property and automatically assume that you’ll be able to rent it out or sell it when you move.

Ask your NeighborWorks homeownership planner for his/her assessment. There are also a myriad of tools available online to calculate the financial benefit of renting or buying, depending on your situation.

How will owning a home change my life?

Owning a home takes time and hard work and it is perhaps the greatest financial investment you may ever make. It’s essential that you protect your new asset through home safety precautions, sound household budgeting, and regular home maintenance. As you pay down your mortgage over time, you have the satisfaction of knowing that you are building equity for the future. You also will gain pride in ownership, personal stability, potential tax benefits and be a part of building a stronger community.

How much home can I afford?

The amount of money you can afford to pay for a home depends on many factors, including your income, your debt, your monthly expenses, the amount of money you can contribute to the purchase up front, among other factors. The maximum dollar amount that a bank will agree to lend you should be the upper limit; in most cases, it is advisable to borrow less than this amount.

There are many calculators available online to help you get a general sense of what you can afford on sites like Zillow, Bankrate.com, and others. These sites take a look at your TOTAL debt when calculating what your maximum home purchase price. When looking at your total debt (your house payment plus any other monthly debts you might be paying), most lenders consider your total monthly debt to be sustainable when it is 36% or less than your gross monthly pay.

There are many factors to consider when deciding between renting and buying, at NeighborWorks we recommend meeting with our homeownership planners as your first step. Our free appointments will allow you to look at your credit, budgeting habits, affordability factors, financial assistance you may qualify for and ultimately how to make your homeownership goals a reality. Create a homeownership profile to get started!

Getting Started: NeighborWorks Customer Portal

Katie Batterbee - Thursday, December 07, 2017

 

Step 1: Get to our Customer Portal

There are many links throughout our website to get you to our customer portal - the most prominent being the "Create a Customer Profile" button on our homepage - or by clicking the "Login|Create Account" in the upper right-hand corner. From here you can just click here - we'll open it in a new tab and you can create your account while follow along.


 

Step 2: Create an Account

By selecting the "Sign up Now" button you will be taken to the page below where we gather very basic information about you and where you are in the home buying process. Fill out this information, click "continue" and fill out the information on the following page - then click "Create Account".

 

Step 3: Check your Email

Our system will have sent you a confirmation email. This email will be from shp@nwgf.org - simply select "Confirm your Account". This step is necessary to move forward.

A window will open prompting you to create a password for your account. Your password must be at least 8 characters long and have a mix of letters and numbers. Once you've decided on a password select "Set Password".

 

Step 4: Complete your profile

Once your password is set and you are in your profile you will see a button on the center of the screen to "Complete your Profile" - click on this. You will be asked a series of questions allowing us to understand your needs and goals regarding homeownership. You can track your progress through the percentage bar at the top. Most of these questions are required, so please take the time to answer all questions. All answers are confidential information. After the last page select "Save".


 

Step 5: Go to the "Training Center" tab at the top of the page

Choose the date you'd like to attend, and click register. After clicking register, the site will prompt you to fill out your credit card information in order to pay and reserve your spot. Our site is secured through Stripe payment processing.

Once you've paid you are all set!

If you'd like one on one guidance with our homeownership planners check your email - you should have a received an email prompting you to follow a link to sign a disclosure document and also instructions to upload your most recent pay stubs under the "My Documents" tab.


Problem signing up?

Give us a call or send us an email - we are happy to help!

 

Budgeting - What to Include, Why, and Where to Start

Budgeting - What to Include, Why, and Where to Start

Katie Batterbee - Monday, November 13, 2017

What is a budget? A budget is a plan for your money. It allows you to track the money going in and out of your household. A budget can also help you prepare for large or unexpected expenses, encourage savings, identify wasteful spending, and help you accomplish financial goals, such as becoming a first-time homeowner, or improving your credit report.

Why do I need a budget? The single most powerful tool to improve your financial situation is to understand your financial situation – where your money is going and how and why you spend it. By laying out all of your expenses and goals, a budget breaks down the steps to financial improvement into day-to-day spending and savings habits. This will let you take control of your finances in order to accomplish your goals.

How do I create a budget?

  • There are numerous resources and tools that can help you construct a budget, such as mint.com, youneedabudget.com, and others. A more personalized approach can be had by working with a NeighborWorks pre-purchase planner to create a budget that is right for you.

    The basic steps to establish a budget, or spending plan, are as follows.

    • Determine your monthly net income – the amount that you take home each month after taxes, withholdings, etc.
    • Calculate your monthly expenses.
      • Fixed expenses stay the same every month – like rent or a car payment.
      • Periodic fixed expenses are paid periodically for goods and services, like car insurance, water, electricity, etc.
      • Flexible expenses change from month-to-month – groceries, entertainment, and travel.
      • Indebtedness expenses are debt for goods and services bought on credit. Credit card debt, student loans, and car loans are common types.
      • NeighborWorks Tip: It can be helpful to simply record all of your financial transactions for a month or more, so you can see where your money is actually going. Compare this to the expenses you have calculated.
    • Subtract your monthly expenses from your monthly income.
      • If expenses exceed income, plan to reduce debt and increase income.
        • Flexible expenses are often the easiest to reduce – cut back on discretionary spending for entertainment, meals out, etc. Distinguish between ‘wants’ and ‘needs.’
        • Pay down high-interest debts first, especially on credit cards. These debts cost you more the longer you owe them.
      • If your income exceeds your expenses, begin saving.
        • Start with an emergency fund - enough money to cover your basic living expenses and debts for a period of 3 to 6 months.
        • Retirement savings - 401(k) or IRAs are a good place to save money for retirement.
        • Savings for big purchases, like a down payment on a house, or a new car!
    • Evaluate your plan.
      • Which financial habits/circumstances are easiest to change? Which are the hardest? Is a house worth giving these things up?
      • Are you ready to implement this plan right now, or are there other things you want to do first?
    • If homeownership is your goal and it appears to be within reach, set a savings goal: buying a home. Compare your monthly budget against the upfront and ongoing costs of buying a home. These can include:

      Upfront Costs: down payment, inspection, appraisal, closing costs, escrows, reserves, and moving costs

      Ongoing Costs: Mortgage payments, utilities, maintenance and repairs, common charges, and emergency funds.

      Seems like a lot? Get in touch with NeighborWorks! We'll help you step by step to achieve your dreams of homeownership.

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