Chapter 10 - • How Much Can You Afford • Affordable...

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Chapter 10: Purchasing and Financing a Home Chapter Objectives Explain how to select a home to purchase Explain how to conduct a valuation of a home Describe the transaction costs of purchasing a home Describe the characteristics of a fixed-rate mortgage Chapter Objectives (cont’d) Describe the characteristics of an adjustable-rate mortgage Show how to compare the costs of purchasing versus renting a home Explain the mortgage refinancing decision Selecting a Home Purchasing a home may be the single biggest investment you will ever make and requires serious consideration Relying on a realtor can be helpful, but make decisions that meet your needs Using online realtor services usually saves money in commission charges
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Unformatted text preview: • How Much Can You Afford? • Affordable down payment What is the market value of the assets you will use to make your down payment? You also need to allow for closing costs and some unanticipated expenses • Affordable monthly mortgage payments Refer to your cash flow statement Your mortgage payment may replace a rent payment but there are other expenses to consider Allow for continued saving • Financial Planning Online: How Much Money Can You Borrow? • Go to: http://calculators.aol.com/tools/aol/home01/tool.fcs • This Web site provides an estimate of how much you could borrow to finance a home, based on your income and other financial information...
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