Buying a New Home - August 1, 2008

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There are many pitfalls you can avoid when you are in the market to buy a new home. Here are just a few tips and strategies to help you prepare for success:

Know your credit score. You may be able to get a better mortgage rate and more favorable loan terms by restructuring some of your balances on credit cards, car loans, etc. Certified Mortgage Planning Specialist professionals help you correct errors on your credit report and determine which balances to restructure or pay off in order to improve your credit score.

Know how much you can spend and determine how much you can afford. CMPS professionals can help you:

• Finance your home based on your monthly payment comfort level
• Determine how much cash to use as your down payment and where to get these funds
• Understand your before and after-tax monthly payments
• Restructure some other debt you may have to free up more monthly cash flow that enables you to improve your home buying budget

Don't get caught in the "pre-approval"/"pre-qualification" trap. It is always better to get a full approval/loan commitment from a CMPS professional before you even start looking for a home. Many mortgage brokers and lenders will give you a "pre-approval" or "pre-qualification", but these are often meaningless. What you really need is a bona fide commitment from a mortgage lender that you are in fact approved for financing. Many real estate transactions have been ruined because buyers, sellers and Realtors have counted on "pre-approval" letters that proved meaningless.

Determine whether to rent or buy a home based on timeframe, budget and local market conditions. CMPS professionals help you run the numbers to determine if it is better for you to rent or buy a home based on your individual circumstances.

Don't be scared by "housing bubble" misinformation. For the last four years, the national media has been scaring potential home buyers with continuous chatter about a so-called "housing bubble". For the last four years, the national media has been wrong. It is always wise to base your decision to buy or not to buy on fact, not emotional hype. CMPS professionals help you evaluate conditions in your local real estate market to determine whether there is indeed a housing bubble" in your local market. The data they can evaluate for you includes: local housing inventory, local unemployment rate, speculation and other factors that can help you make intelligent choices about whether to buy a home.

Develop a strategy for financing your closing costs, home improvements and furniture expenses. A home purchase is a significant financial commitment. CMPS professionals help you understand the costs involved in home ownership and help you develop a financial strategy for dealing with these costs ahead of time.

Evaluate the mortgage products that will work best in your situation. Remember, it is far better to find a CMPS professional who can help you implement the best strategy with competitive interest rates than for you to shop for the lowest rate with the wrong strategy.

Warm Regards,

Joel Ellowitz, CMPS®
Certified Mortgage Planning Specialist
Movement Financial Group/zoomUTAH.com
5941 S. Redwood Rd.
Suite 200
Taylorsville, UT 84123

801-949-4872 direct
801-326-4874 fax