One tip for being proactive about managing your mortgage payments over the years ahead is to think carefully about the future when choosing your home and mortgage.
Homebuyers who consider their goals for the future and the possible ways their lives can unfold will be able to make the most informed decisions, choosing home loans that are likely to meet their needs just as well years down the line as they do today.
4 Factors To Consider When Choosing a Mortgage
Below are a few financial goals you should take into account when you are shopping for a home and mortgage.
- Career plans. In order to apply for a mortgage successfully, you only need to be able to document a two-year employment history. That history does need to show you are on a solid career trajectory. You should ask yourself some questions about that trajectory. How likely is it you will stay on it in five years, ten or twenty? Do you think you might eventually change jobs or industries? Will you or your spouse take time off to raise kids? What is your likely earnings growth potential? What will you need to do to keep increasing your earnings? The answers to these questions can vary quite a bit depending both on your long-term goals and your current job role and industry. Those answers may also impact your plans with respect to your geography (see below).
- Plans to stay in your home or move. One very important question to ask when applying for a mortgage is, “How long do I want to stay in the home I am buying?” If you expect to stay in the same job at the same company for the next twenty years, perhaps you also expect and desire to stay in the same home. In that case, a fixed rate mortgage is a good option. But if you work in a field where you may need to move to another city in a few years, an adjustable rate mortgage with a low introductory rate might be a fit for your needs. You also might be looking to move in a few years simply to upgrade to a bigger home or move to a more expensive neighborhood. In either of those situations, you might also consider an adjustable rate mortgage for short-term savings.
- Retirement plans. At what age do you want to retire? How much money do you want to have saved at that point? This should be another key consideration when choosing a home and a mortgage.
Here are a couple of things to think about:
– Make sure that your mortgage payments will be low enough each month that you can set aside what you want in your retirement accounts.
– You might be buying the home now as an investment. You could either sell it in the future or eventually turn to a reverse mortgage to tap into your equity.
Whatever course you decide on, you will need to run some computations to ensure that your mortgage will help you meet your retirement goals.
- Plans for your children’s future. One more thing to think over when you are choosing a home and a mortgage is your goals for your children. While you are saving for your retirement, are you also working on creating a nest egg you can pass down to them? And do you want them to be able to inherit your home? If so, do you think your children are likely to want to keep the home, or sell it? With respect to your heirs, it is wise to have a conversation directly with them, rather than making assumptions about their expectations or preferences for the future. That way you can plan together and go over all of the possibilities for your future.
Lending Bankers Mortgage is passionate about helping homebuyers and homeowners make smart financial decisions for their future!
During your consultation, you can discuss your financial plans and goals with us in detail, and we can help you decide how your choice of home and mortgage can impact those plans.That way, you can find the home loan that will help you achieve your dreams for yourself and your children.
If you are ready to get started, please give us a call now at 786-220-1100. We look forward to connecting you with the right mortgage!
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