Deprecated: mysql_connect(): The mysql extension is deprecated and will be removed in the future: use mysqli or PDO instead in /home/a26f9f83/public_html/articles/includes/config.php on line 159
Budgeting Before Buying > NetSparsh - Viral Content you Love & Share

Budgeting Before Buying

With interest rates being at an all-time low, I can understand the urgency for people wanting to purchase a home. But I caution the first-time home buyer to learn how to budget their money before buying a new home.

I happen to live in a state with one of the highest foreclosure rates in the country. I was so shock to learn that many people loose their homes within the first couple of years. I wondered why so soon. Sure the economy is not the best and people are getting laid-off and having hardships, but some people are simply not prepared for the unforeseen problems and expenses that comes with owning their first home.

When I received a call from a friend telling me about a property less than a mile from my home that was in the process of being foreclosed on, I quickly made arrangements with their agent to view the property. It was a nice single family residence with some minor wear and tear. The family that was loosing the home was a basic middle-class family. I had less than three weeks to close the deal since the home was to be sold on the courthouse steps the following month.

Needless to say I bought the home and had instant equity in the property. Before the closing, I sat down with the previous owners and asked why they were loosing their home. The wife said to me in a matter of fact way, "Well we started falling behind on some bills, and soon things got out of control." I wanted to ask her if she had a budget, did they keep track of their monthly expense but I didn't want to impose on their privacy. However, I explained to her that I was a Financial Coach and worked specifically with people to help them customize a budget. She promised to get in touch with me after the transaction but I never heard from her again. I often wonder if things would've worked out differently seeing as if they had utilized a budget before and after buying their home.

I share with my clients some advice I heard from one of my financial mentors. Before buying a home, put aside the difference of your rent from what will be your mortgage payment, taxes, and insurance for six months. If you can manage without going into the money or finding it to be a hardship on your lifestyle then my advice is too update your budget with the category "repairs". Take 1% of your purchase price, divide that by 12. If you can budget this monthly cost into a separate savings account you are ready to become a first-time homeowner.

[If you're interested in this article and would like to use it on your own website or ezine, you may do so ONLY if the article is not changed in any way and the author information is included.]

©Copyright(c) 2004

Dina Harbour, Founder:
Wanted Debt Or Alive:
A Debt and Money Management Consulting Service.
Please visit my website at: http://www.wanteddebtoralive.org

In The News:


USA TODAY

Pete the Planner: Road to early retirement may be bumpy - USA Today
USA TODAY
You will need some luck to ensure financial success in early retirement.

and more »

USA TODAY

Personal finance: 15 smart things you can do with $1000 right now
USA TODAY
A thousand dollars might be pocket change or a rounding error to multimillionaires and billionaires, but it's a meaningful sum for the rest of us. Any amount of money that we can save can be put to good use. Here are 15 examples of smart things you can ...


Unexpected Costco bargains and whether a millionaire daughter ...
MarketWatch
My daughter earned millions at Google, but her boyfriend has student debt — should she get a prenup? This father wonders whether his wealthy, smart daughter ...

and more »

Chicago Tribune

Personal finance experts reveal their favorite money apps
Chicago Tribune
Both David Bach, nine-time New York Times best-selling author of books such as Smart Couples Finish Rich, and J Money a personal-finance blogger at Budgets Are Sexy, are fans of this app. “You won't get rich off of this, but it's a great way to dip ...


Benzinga

In Its 10th Year, Personal Finance App Mint Is Investing In AI, Data ...
Benzinga
Mint, the personal finance app owned by Intuit Inc. (NASDAQ: INTU), could be transformed by artificial intelligence and machine learning. That's according to ...

and more »

After painful personal loss, managing money looms as key challenge
Minneapolis Star Tribune
A thoughtful personal finance guide for recently widowed or divorced women is "Money Confidence: Smart Financial Moves for Newly Single Women," by Kerry Hannon. Hannon is passionate about helping people gain control of their finances and her book is ...


Personal finance seen as big gap in education - Lowell Sun Online
Lowell Sun
BOSTON -- Eric Swansburg, a business teacher at King Philip Regional High School, passed a 100-question test around his class last week to gauge students' ...

and more »

USA TODAY

How to invest without losing money
USA TODAY
... bonds offer generally stable returns with very limited risk, and in some cases no risk at all. The problem is that safety comes with a price. CDs, to examine one cash equivalent, constitute an agreement in which you give your money to a financial ...


Daily Nation

PERSONAL FINANCE: The debt catch up
Daily Nation
The bank calculated this regardless of her other financial obligations. Susan now realises that to comfortably afford the loan, she needs to be earning 30 per cent more than she is now. She needs her income to increase just to afford a loan that she ...


Forbes

How To Stop Boring Students When Teaching Personal Finance
Forbes
My mission for the past seven years has been to help students and recent graduates develop healthy money habits and build the foundation for a lifetime of financial wellness. As the co-founder of the Harvard University Personal Financial Management ...

Google News

One Income Source Is Not Enough!

My personal opinion is that in today's new economy, it... Read More

Budgeting Your Way to Financial Freedom

Financial freedom cannot be achieved without budgeting. Budgeting involves tracking... Read More

What?s New in Checking ? From Designs to Photos

Just about everyone has a checking account. Checks present easy... Read More

A Fresh Start for Family Finances in 2005

While 40% to 50% of us make New Year's resolutions... Read More

10 Tips To Save Money When Dining Out

Here are some tips that can help you save money... Read More

Identity Theft ? More Tips on How it Can Be Avoided

Recent security breaches at several credit card companies continue to... Read More

Check Facts and Figures

Are you a check fanatic? Don't worry, you aren't alone.... Read More

College Expenses: Seven Ways to Save on an Education

Many people graduate from college owing thousands of dollars in... Read More

How to Save Money in a Grocery Store

Now there are ways to save money in the grocery... Read More

Check Fraud and Verification

Before buying personal or business checks you should inform yourself... Read More

How To Protect Yourself Against Identity Theft

Identity theft is a serious crime that continues to grow.... Read More

Tips To Save Money At The Supermarket

Are you interested in saving money off your grocery bills?... Read More

10 Tips to Make Sure Your Financial Budget Will Succeed

You've analyzed your past expenses, put them into spreadsheets, loaded... Read More

The Changing Shape of Family Finances

Super-mumsIt seems that the proof of maternal efforts is no... Read More

If I Had a Structured Settlement, I Would Use It to Pay for Gas

Has anyone been to the gas pumps lately? Soon $3... Read More

Basic Bank Accounts Failing the Basic Needs of Consumers

The lists of bank and savings accounts that are available... Read More

Estate Planning Basics

You have probably accomplished a great deal with your life.... Read More

Vesting and Your 401(k)

Do you have a 401(k) retirement account? Are you vested... Read More

Expenses A ? What Are They And What Can We Do About Them

It is crucial as an individual who is striving for... Read More

Bankruptcy Laws Get Tougher - More Expensive

If you've been thinking about filing for bankruptcy, your best... Read More

How To Survive The Grocery Shopping Blues

If you are the normal consumer, then you've probably experienced... Read More

Healthy Eating On A Budget

It is possible to eat a healthy, balanced diet without... Read More

How to Draw a Personal Budget that Works

Many people spend their little income haphazardly without any planning... Read More

Roth IRA Contributions - IRS Rules

Confused about whether you can contribute to a Roth IRA?... Read More

Why Live Frugally

What is it about being frugal, why do it at... Read More