Posted on: Sunday, June 27, 2004

What new buyers should consider

Knight Ridder News Service

Where do you want to live? Factors that might affect your choice of location are schools if you have children, and proximity to your job, shopping, and public transportation (if you use it).

What kind of house do you want? How many bedrooms? What style of architecture? How big a lot will suit you if you like to garden — or if you want to be relatively free from property maintenance? Make a list of these, among others, and establish priorities.

Can your budget handle a house? Conventional wisdom suggests that expenses associated with shelter should be no more than 33 percent of your monthly gross salary. But 33 percent might be too generous; for example, if one partner in a two-paycheck family loses his or her job. Mortgage payments should be small enough to be kept current by one paycheck.

Can you get a mortgage? Long-term debts can complicate matters. Because financing is tied to your credit history, order a credit report from one of the national reporting agencies to see whether there is something that could tie up your financing or result in a rejection. Take care of the problem.

Are you willing to share confidential information? If you aren't, your real estate agent will not be able to show you the houses you can afford or help you find a financing package that meets your needs.

Can you get homeowners' insurance? Shop around before you buy. A lot of deals are being derailed by insurers' increased scrutiny not only of buyers but also of sellers. A black mark on either side of the table can cancel a policy.