Every first time buyer experiences the thrill of home ownership only to be dashed with ‘payment shock’. These first time buyers compare their current rent payment to that of the house payment of the home they want to purchase. Home buyers compare their rent vs. the housing payment of PITI, [or Principal, Interest, Taxes and Insurance]. From that comparison, the thought of home ownership seems even more years away.

But, that comparison is not valid. Home ownership has merit!  Not only do you get to own your own home, fix it up as you want, pay your mortgage, (not your landlord’s mortgage) - but as a home owner, you get the tax ([deduction) benefits afforded to every home owner. So how does a first time homebuyer recover from "‘sticker / payment shock"?

The beginning step of home ownership is determining if you can afford it. Have you created a budget? Have you tried to live with that budget? This is a crucial step in purchasing a home. Take time to create, review and modify your budget.  Include not only housing, food, auto, clothes, utilities, but add your entertainment, 401K contributions, your savings, plus, add a ‘reserve account’ for emergencies, whetherfor time off from work or maintenance and repairs to your new home.

To get an idea what you are dealing with, click on the link below to access different sales prices of homes, and take a look at the price range that might best suit you and your family.

Buy vs. Rent Reports:
You will be directed to a new page of my website that will allow you to pick one of 6 price ranges that you may want to consider to purchase. I have created all of these options based on an FHA 30 Yr Fixed Rate loan. An FHA loan requires a minimum down payment and that down payment can be a gift, which needs to be documented.  Once you pick a price range, you will find three reports for you to review.  These are:

• A Planning Worksheet for determining the costs associated with purchasing a home and the estimated house payment for that home.  Note that I show on the worksheet a line item highlighted in yellow, where you can negotiate the Seller to pay some or the majority of your closing costs.
  
• A Tax Implication Report, so you can see exactly the effect of owning a home.  This report will show you the annual dollar amount of your tax savings and will show you the ‘comparable’ rent for a home purchase.  Call me to discuss this page in detail, but it will give you clues as to how you can help use the tax advantage of home ownership to help you with making your house payment. 
  
  This report will show where the benefits will come from with home ownership and will reflect on how to budget your monthly cash flow.  You can see what your payments will be monthly and payments you would make over a tax year.  And finally, if you take advantage of the tax deductibility, you will see how your house payment can be adjusted to be closer to your current rent payment! 
  
  And, in the right column of the report, I show you how home ownership can increase your net worth over the next five years.  How would you like to increase you investment 6 fold by owning a home?
  
  
• The Payment and Savings Report will show you the savings in your housing obligation and will compare how much money you will spend over 7 years or 10 years, based on owning a home.  At the end of the report, you will see the advantages of home ownership very quickly, and you will determine, that yes, home ownership is for me.

To access the different Sales Price of homes and the specific “Buy vs Rent” reports, click on the link below and find the price range that might best suit you and your family.

Calculate Your Payment:
If you are just beginning the process about home ownership, you may want to see what your house payments would be based on the anticipated purchase price and loan amount. Many factors can change what the final house payment will be for you.  This would include Real Estate Taxes, Home Owners’ Insurance, and possibly, Homes Association Dues, if any.  To see what your payment could be, click here to see my payment guide.