Hey there! Michael Sema here with Get A Rate. So I'm really excited to talk
to you guys today about our True Affordability Calculator specifically
designed for first-time homebuyers trying to figure out how much home they
should buy, versus can buy and let me explain to you why this is so important.
There's an alarming rate of almost 80% of homeowners across the country that
regret the decisions they made during the home buying process and it's because
most of them regret overextending themselves financially. So we as a
company decided to figure out why was this happening and why wasn't there any
tools out there to help first-time homebuyers really better prepare
themselves for the future expenses of being a homeowner. The research revealed
that there was 3 major mistakes that happened: Mistake #1 - Not
calculating future home maintenance expenses such as utilities ongoing
expenses of appliances et. Mistake #2 - Not calculating current
lifestyle expenses. Now, this is a huge oversight that first-time homebuyers
make because they don't account for any sacrifices they'll need to make to truly
afford a home. And Mistake #3 - Trusting the wrong professional; I'll
explain this in a little bit. So before we get started, I think is extremely
important to remember that pride of home ownership should never be at the cost of
sacrificing your happiness. And by using our Affordability Calculator, you'll have
a detailed breakdown of what the future expenses will be based on a specific
purchase price and what savings you'll have left over after your lifestyle
expenses. Now, let's get started. Our Affordability Calculator has a
3-step process: Step #1 - Basic information on income, credit, down
payment and more that typical mortgage lenders will ask you for. Step #2 -
this section here, we're asking you basic information on monthly minimum payments
on outstanding debts like cars credit cards, basically information that's gonna
pop up on your credit report. And Step #3 - personal lifestyle expenses
like groceries, utilities, pets, travel and more. Now this, to us, is the most
important step because it outlines what if any sacrifices you'll need to make to
become a homeowner and it's a step that none of the banks and lenders
or brokers take the time to really calculate with you and the main reason
is because none of them want you to change your mind. It's important to
remember that the banking industry is commission based and every loan advisor
you talk to is incentivized to close your loan and the higher loan amount you
take, the more money that they make so be very, very careful on who you're working
with and it's extremely important to take the time to truly understand what
your future expenses will be. So let's get started. So we'll start with a basic
example of a husband and wife and that have two kids. Their total yearly
combined income is around $65,000. The amount that they have for a down payment
is around $25,000. The zip code that they're looking to purchase in is 07407
Their current credit scores are anywhere from 740 - 850 - Just in
case if your credit is a little bit lower, you could always select on the
other options below this. The term that they selected is a 30 year. The
annual HOA dues we mark down $0 here because they're only for condos or
townhomes. So just in case, if you are purchasing one, double check what the
monthly association fee is, multiply it times 12 and put that number right
in here. This section here is the annual homeowner's insurance and we put down
about $750 per year here.
Marital Status married and children 2. It's important we add this in because
it's gonna show us what our tax bracket will be and how much deductions we'll be
able to have by being a homeowner based on a specific purchase price and based
on certain taxes we're gonna pay. Now I don't want to confuse you with too much
right from the beginning but make sure you add this information in here
correctly. So let's go into the monthly primary expenses: Section #1 - car
payment. Monthly expense, let's say it's about $200 a month. Credit card payments
let's say it's another $200 on a month. Student loan $0 and alimony child
support $0. Now here's the fun part: the monthly personal expenses - try to get
as detailed as possible with this section because it's really going to
help you to figure out exactly how much home you should be entertaining. Now,
click on the arrow below, and enter let's say for example your auto insurance how much
are you paying per year divided by 12 and add that in. Usually, we pay quarterly
or every six months, but our auto insurance for this example is about $25
a month. Gas & Fuel: they were spending about $150 a month.
They don't pay for parking; they don't pay for public transportation and
services in parts, let's put down I don't know an extra $10 a month. Bills
& Utilities - let's throw a in $30 for Internet, $30 for television, $30 for home and
because it's a family example, lets put about $100 in cell phone
bills. Utilities - this section is a section that I would say 90% of
homebuyers make a mistake in and it's because they don't know what the future
expenses will be, based on the utilities on a particular home. A safe way of
really calculating this is calculate the square footage of your current apartment
or wherever you currently living and calculate the new square footage of the
new apartment. There's a lot more that goes into it based on the age of the
appliances, especially the HVAC system but - safe bet multiply it by whatever the
number is - so for example if you're currently living in a rental apartment
at a 1,000 square feet and you're moving into a home at 3,000 square feet
and you're paying $200 you know the utilities now multiply that times 3 so
put down $600. And this is a high number but let's play it safe and put $400 like
for a 2,000 square foot example. Education - we'll leave this blank.
Entertainment - we can leave this blank but you guys could really get into
detail in this section just in case of you're buying magazines or you have
newspapers that come by weekly we could just put down $30 for
now for the month. Fees and Charges: bank fees, finance charges, ATM fees, late fees,
services. Next is Financial Advisor, Life Insurance - let's put down about $100 in
this example per month. Groceries - it is a family, so let's just say about a $150
per week and that comes out to about $600 for the month
Restaurants - let's say you guys go out once a
month. Let's put down about $50 there. Beers, coffee shops, lunch, take out
whatever the current expense is, I would add that in there just so you could see
an example of what you could afford if you keep things the way that they
currently are. Now, gifts and donations we'll leave this blank. Health & Fitness -
let's put about $50 for a gym membership. Here you have doctor, dentist, health
insurance, depending on what the overall cost is per month and what you guys are
responsible in to cover - let's put down about $200 for a family. Home - let's see
furnishing, home improvements, home services, home supplies, lawn and
garden. This section is a section of homebuyers do make a mistake on because
they don't calculate the future ongoing maintenance expenses for a home. The
average calculation is about 1% based on a purchase price. So on a $250,000
purchase price, you're going to be paying around $208 per month. We could leave the
rest blank for now. Child Care, Allowances, Baby Supplies,
Babysitters, Daycare, Children Activities, Toys. In this example, they do have 2
children, so let's just put down, let's put down about $100 per
month. Personal Care, Hair, Laundry Spa that's
put about $50 here. Pets, Food & Supplies, Grooming. A Vet - I have a Frenchie
so on my end, I know exactly how much it costs to
really own a dog and it's definitely - Frenchie are definitely a little
bit more difficult than others especially when it comes to the vet but
he's a good little boy let's put down about 50 dollars a month in food and
let's put down another $50 in vet costs. Here we go - Shopping, Electronics, Software,
Books, Clothing, Hobbies - let's put down an extra $100 for the family in
Clothing per month and also Travel. Now, depends how many time you guys go away a
year. Calculate the average cost for your vacation and divided by 12. So I'd say
for a family of 4 they go away once a year they're spending around 2,500
divide that by twelve let's put down $208 per month.
And let's hit Calculate and see what pops up. So here we go - The Affordability
Calculator Results based on this scenario of $65,000 income, $25,000 down,
Zip Code that they're looking to purchase in 30 year fix has given us a
average of a $143,733 on a
purchase price. Now, you could be a little bit more conservative and drag this to
the left or you could drag it to the right and be a little bit more
aggressive based on a purchase price.So let's do this, you could also just enter
the number right in here and the calculations will automatically pop up.
Monthly expense just for the mortgage, debt to income ratio is 37%
which is good for a bank. Loan Amount $225,000
because remember in this example were putting about $25,000
down as a downpayment. Purchase price is $250,000, so your loan amount is
going to be $225,000. Average interest rate of 3.875%.
Now, if you scroll down, this section here is really going
to break down the monthly income on average, the mortgage payment, the
property taxes based on the zip code that you entered. Now, let's talk a little
bit about this - depending where you are or where you're looking to purchase
sometimes if the zip code in this calculator, doesn't pop up, all you
have to do is leave this number here, the 07407 number and add in
what the average taxes are for that specific location, town or even a home if
you have selected one. Add in the yearly tax amount here and hit calculate
all the way at the bottom - which is right here - and the results will pop up again.
Now, income tax bracket based on the scenario, they're going to be paying
around $309 in taxes per month. Homeowners insurance based on the $750
amount that we selected earlier, is gonna be about $62.50 per month. There
are no HOA dues because we're focusing
on a single family not a condo not a townhouse and the PMI payment because
they are only putting 10% down is going to come out to $56.25
per month primary expenses based on car expenses
credit cards they have about $400 a month and then
personal bills around $2,571. Now, if you wanted a little bit more in
savings, you could scroll to the left let's say we look at a $171,000
purchase price - Savings goes up an extra almost $500
Now they're closer to $1,039 and you can
also get a little bit more aggressive just in case you wanted to push it, let's
say to $275,000, let's say $271,000 so thank you for joining us today
and I hope that you found some insight by using our Affordability Calculator
and if you have any additional questions in regards to the home buying process
just log on to getarate.com Thanks again, Take care!
For more infomation >> Hyundai i20 1.2i Dynamic - Duration: 0:54. 
For more infomation >> Citroën C2 1.4i Ligne Prestige - Duration: 0:54. 
For more infomation >> I'M GONNA BE COMPLETELY - SCC - 608 - Duration: 1:01. 
For more infomation >> Mazda 6 Sport 2.0i Touring 5 Deurs 6 Versn. - Duration: 0:59. 
For more infomation >> Mazda 626 1.8i LX - Duration: 1:02. 
For more infomation >> Honda Civic 1.4i S - Duration: 0:54. 
For more infomation >> Hyundai Atos 1.1i Automaat! E450 Extra! Zondag OPen! - Duration: 1:00. 
For more infomation >> Co to jest system jednego klucza Master Key? Zalety i możliwości. - Duration: 2:12. 
For more infomation >> Campaign For A Better Next Weekend - Duration: 5:01. 
For more infomation >> Sea Girls - Call Me Out - Duration: 3:56. 
For more infomation >> lululemon | Strength To Be | Fort en soi | Orlando Cruz - Duration: 0:31. 
For more infomation >> Jeep Renegade O|||||||O 1.4 MULTIAIR LIMITED Full-Navi,18"Velg, Parksensors, Led. Rijklaarprijs! - Duration: 0:55. 
For more infomation >> Lady Gaga zmaga się z poważną chorobą. Wreszcie powiedziała o niej głośno - Duration: 2:38. 
For more infomation >> Foque em um dia (de cada vez) | QUOTES - Duration: 2:29. 
For more infomation >> MailChimp #3: a importância dos títulos impossíveis de serem ignorados - Duration: 11:21. 
For more infomation >> Nissan QASHQAI 1.2 TEKNA (Panoramadak) - Duration: 1:01. 
For more infomation >> Tajemnica uszkodzonej ręki Isabel. Na zdjęciach coś nie gra - Duration: 4:23. 
For more infomation >> Anitta exibe bronzeado em passeio de barco e dança hit 'Baldin de Gelo' - Duration: 4:31. 
For more infomation >> Scarlett Johansson wzięła rozwód. Niedługo świętowałaby trzecią rocznicę ślubu... - Duration: 1:56. 
For more infomation >> Cienie Argus, część VIII | World of Warcraft: Legion - Duration: 18:34. 
For more infomation >> O Meu Depoimento (Mi testimonio) António de Oliveira Salazar -1949 Subtítulos en español - Duration: 6:02. 
For more infomation >> Apresentação da Série VTB Florida 2017 [#001] - Duration: 2:12. 
For more infomation >> Formato de establecimientos y secciones - Duration: 3:19. 
No comments:
Post a Comment