By knowing how much mortgage you can handle, you can ensure that homeownership will fit in your budget. Homeownership should make you feel safe and secure, and that includes financially. Be sure you can afford your home by calculating how much of a mortgage you can safely fit into your budget. Why not just take out the biggest mortgage a lender says you can have? Because your lender bases that number on a formula that doesn’t consider your current and future financial and personal goals. Think ahead to major life events and consider how those might influence your budget. Do you want to return to school for an advanced degree? Will a new child add day care to your monthly expenses? Does a relative plan to eventually live with you and contribute to the mortgage? Consider those lifestyle issues as you check out these four methods for estimating the amount of mortgage you can afford. 1. Prepare a Detailed Budget The oldest rule of thumb says you can typically afford a home priced two to three times your gross income. So, if you earn $100,000, you can typically afford a home between $200,000 and $300,000. But that’s not the best method because it doesn’t take into account your monthly expenses and debts. Those costs greatly influence how much you can afford. Let’s say you earn $100,000 a year but have $1,000 in monthly payments for student debt, car loans, and credit card minimum payments. You don’t have as much money to pay your mortgage as someone earning the same income with no debts. Better option: Prepare a family budget that tallies your ongoing monthly bills for everything — credit cards, car and student loans, lunch at work, day care, date night, vacations, and savings. See what’s left over to spend on homeownership costs, like your mortgage, property taxes, insurance, maintenance, utilities, and community association fees, if applicable. 2. Factor in Your Downpayment How much money do you have for a downpayment? The higher your downpayment, the lower your monthly payments will be. If you put down at least 20% of the home’s cost, you may not have to get private mortgage insurance, which protects the lender if you default and costs hundreds each month. That leaves more money for your mortgage payment. The lower your downpayment, the higher the loan amount you’ll need to qualify for and the higher your monthly mortgage payment. But, if interest rates and/or home prices are rising and you wait to buy until you accumulate a bigger downpayment, you may end up paying more for your home. 3. Consider Your Overall Debt Lenders generally follow the 43% rule. Your monthly mortgage payments covering your...

You’ve found your dream home. Make sure missteps don’t prevent a successful closing. A home purchase isn’t complete until you make it to the closing. Until then, the transaction can fall apart for many reasons. Here are five tips for avoiding mistakes that cause a home sale to crater. 1.  Be truthful on your mortgage application. You may think fudging your income a little or omitting debts when applying for a mortgage will go unnoticed. Not true. Lenders have become more diligent in verifying information on mortgage applications. If you fib, expect to be found out and denied the loan you need to fund your home purchase. Plus, intentionally lying on a mortgage application is a crime. 2.  Hold off on big purchases. Lenders double-check buyers’ credit right before the closing to be sure their financial condition hasn’t weakened. If you’ve opened new credit cards, significantly increased the balance on existing cards, taken out new loans, or depleted your savings, your credit score may have dropped enough to make your lender change its mind on funding your home loan. Although it’s tempting to purchase new furniture and other items for your new home, or even a new car, wait until after the closing. 3.  Keep your job. The lender may refuse to fund your loan if you quit or change jobs before you close the purchase. The time to take either step is after a home closing, not before. 4.  Meet contingencies. If your contract requires you to do something before the sale, do it. If you’re required to secure financing, promptly provide all the information the lender requires. If you must deposit additional funds into escrow, don’t stall. If you have 10 days to get a home inspection, call the inspector immediately. 5.  Consider deadlines immovable. Get your funds together a week or so before the closing, so you don’t have to ask for a delay. If you’ll need to bring a certified check to closing, get it from the bank the day before, not the day of, your closing. Treat deadlines as sacrosanct. G.M. Filisko is an attorney and award-winning writer who wanted a successful closing on a Wisconsin property so bad that she probably made her agent rethink going into real estate. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal...

By: G. M. Filisko When you buy a fixer-upper house, you can save a ton of money, or get yourself in a financial fix. Trying to decide whether to buy a fixer-upper house? Follow these seven steps, and you’ll know how much you can afford, how much to offer, and whether a fixer-upper house is right for you. 1.  Decide what you can do yourself. TV remodeling shows make home improvement work look like a snap. In the real world, attempting a difficult remodeling job that you don’t know how to do will take longer than you think and can lead to less-than-professional results that won’t increase the value of your fixer-upper house. Do you really have the skills to do it? Some tasks, like stripping wallpaper and painting, are relatively easy. Others, like electrical work, can be dangerous when done by amateurs. Do you really have the time and desire to do it? Can you take time off work to renovate your fixer-upper house? If not, will you be stressed out by living in a work zone for months while you complete projects on the weekends? 2.  Price the cost of repairs and remodeling before you make an offer. Get your contractor into the house to do a walk-through, so he can give you a written cost estimate on the tasks he’s going to do. If you’re doing the work yourself, price the supplies. Either way, tack on 10% to 20% to cover unforeseen problems that often arise with a fixer-upper house. 3.  Check permit costs. Ask local officials if the work you’re going to do requires a permit and how much that permit costs. Doing work without a permit may save money, but it’ll cause problems when you resell your home. Decide if you want to get the permits yourself or have the contractor arrange for them. Getting permits can be time-consuming and frustrating. Inspectors may force you to do additional work, or change the way you want to do a project, before they give you the permit. Factor the time and aggravation of permits into your plans. 4.  Doublecheck pricing on structural work. If your fixer-upper home needs major structural work, hire a structural engineer for $500 to $700 to inspect the home before you put in an offer so you can be confident you’ve uncovered and conservatively budgeted for the full extent of the problems. Get written estimates for repairs before you commit to buying a home with structural issues. Don’t purchase a home that needs major structural work unless: You’re getting it at a steep discount You’re sure you’ve uncovered the extent of the problem You know the problem can be fixed You have...

Before listing your home, tap into the talents of a home stager. You may sell your home faster and at a bigger profit Karen Egly-Thompson Houzz Contributor Home staging has become an increasingly formidable force in helping people sell their homes more quickly and for more money. Its overall goal is to help prospective home buyers emotionally connect with a space, hopefully leading to an offer to buy. Home staging isn’t limited to just high-end properties. It has become a norm for homes at all price points. While staging may seem like an additional hassle and expense, the investment can pay off. Here’s a guide to home staging, including the benefits, process and reasons to stage your home if you’re considering a move. Who Hires Home Stagers? Anyone selling or buying property may benefit from home staging. Homeowners selling single-family homes, condos and townhouses make up the greatest percentage of those hiring home stagers. However, property developers selling new construction, and real estate agents, also are in the mix. While home staging was created primarily to benefit the seller, seeing prospective properties in their best light also can be advantageous to buyers because it can cut down on their search time. Benefits of Staging a Home Most people have trouble visualizing a space’s potential, whether that’s figuring out how to lay out an empty room or trying to ignore oddly arranged furniture, clutter or decor that’s not their style. The majority of home buyers can’t easily look past what’s in front of them to appreciate a room’s potential. Staging helps eliminate the buyer’s guesswork. “The key is to set the stage for potential buyers to imagine themselves living there,” says home stager Robin DeCapua of Madison Modern Home. A 2015 study by the National Association of Realtors confirmed that more than 81 percent of home buyers find it easier to visualize the property as their future home when it’s staged. Had the staged living room seen here been empty, many people might have found the large space intimidating and possibly off-putting. Instead, Audrey Gourguechon of Staging North Shore in Chicago created multiple seating zones to highlight it as an inviting living and entertaining space to potential buyers. Prelisted staged homes spend 90 percent less time on the market than their nonstaged competition, according to a 2016 report by the Real Estate Staging Association. Considering the monthly carrying costs — mortgage, taxes and utilities — that translates into a lot of saved cash if the home spends less time on the market. Shopping for many things these days is done online, and real estate is no exception. “Today, buyers look at the online photos before deciding to come in and view...