Posted by: RM Beltran | November 6, 2011

Step #2 The dreaded #, how much can I afford?

Before you start touring homes for sale, it’s important to start off with a budget so you know how much you can afford to spend. Knowing what mortgage payment you can handle will also help you narrow the field so you don’t waste precious time touring homes that are out of your reach. The key factor in figuring how much home you can afford is your debt-to-income ratio. This is the figure lenders use to determine how much mortgage debt you can handle, and thus the maximum loan amount you will be offered. The ratio is based on how much personal debt you are carrying in relation to how much you earn, and it’s expressed as a percentage.

The ideal ratio most mortgage lenders generally use are a ratio of 36 percent as the guideline for how high your debt-to-income ratio should be. A ratio above 36 percent is seen as risky, and the lender will likely either deny the loan or charge a higher interest rate. Another good guideline is that no more than 28 percent of your gross monthly income goes to housing expenses.  Of course there are exceptions to the rules for example, a higher loan term, government program or, a sub-prime mortgage in which these programs ratios can go as high as 45 percent.

You don’t want to end up finding the right home and not being able to capitalize on it. Talk to your real estate agent in advance: tell them where you stand and have them look for the appropriate properties for you. If you don’t have one, or have questions, you can post your profile at and get your questions answered: before you spend too much time out there perhaps looking at the wrong places.

Posted by: RM Beltran | October 18, 2011

Homebuying Step # one

With the credit crunch as it currently is, it will be nigh to impossible to obtain a mortgage with a credit score lower than 650. Even if you have a substantial down payment, banks are unwilling to lend money to people. And to a bank, a score of 650 or lower is too great a risk. So, lesson number one is to make sure you have good credit rating before you apply for a mortgage. 

According to U.S. law every American consumer is allowed one free credit report annually. Simply do an Internet search on the term “free credit report” and you’ll be able to find out what your current score is. If it’s 650 or lower, it might not even be worth trying to obtain a mortgage. Instead, work on rebuilding your credit by paying your bills in a timely manner. If you have high interest credit cards, making monthly payments on time, which are slightly more than the balance due, goes a long way in repairing your credit. Conversely, every late payment on a credit card or utility bill counts against your score.  Many mortgage companies can assist you in repairing a bad credit history like and guide you through the mortgage process.

Posted by: RM Beltran | October 3, 2011

Nervous of making the first move?

After 20 years interviewing potential homeowners, my experience with first time homebuyers seems to be most of all nervous about the dreaded application and even worst the wait for the response for an approval.  Have no fear, technology is on your side.  Now instead of setting up an appointment to be interviewed by the stuffy banker, now your approval is only a click away.  Using a secure website like the response is quick and easy and  can even work up a plan to get you started on your way to homeownership.  Our next blog will be the many options first time homeowners have and the special programs geared to make the first move easier than you think.  You’ll be saying to yourself why you waited so long to do this,  I’ve heard that lots of time.