Repayment plans for student loans can be overwhelming and lead many graduates take advantage of forbearance or deferral plans in order to buy themselves more leniency and time. Unfortunately, this is debt that can follow people well into their adult years, and it can have a significant impact on purchasing power and nearly all major investment decisions. If you’re thinking about buying a Downtown San Diego condo for sale but still have student debt, following are a few important things to consider.
Your Debt-to-Income Ratio
Irrespective of the type of debt that you have, mortgage lenders will want to know that you have sufficient income for both managing your existing debt and managing any new debts that you take on. Many prospective buyers find that they have more than adequate income for covering their current bills along with the added costs of condo ownership. Others, however, may find that when ownership costs are considered in full, there is simply not enough disposable income left for maintaining suitable life qualities. If you have student loans, the best way to prime yourself for ownership is by paying as much of your total debt off as possible. This will lower your debt-to-income ratio (DTI) and free up more disposable income for other expenses. A low DTI will also significantly increase your chances of getting a mortgage loan approval.
The Costs of Ownership
When budgeting for the purchase of a Downtown San Diego loft or condo, some people make the mistake of assuming that their mortgage loan payments can be counted in place of their current rent. Although the costs of renting and the costs of a mortgage payment can be fairly comparable in some areas and instances, there are other costs of ownership that must be accounted for in your pre-purchase planning and budget. As a condo owner, you will also have to pay fairly substantial Homeowners’ Association (HOA) dues, full utilities, property taxes, mortgage insurance, and condo insurance, making it likely your month-to-month living costs will rise. You must have the job and financial stability for accommodating this increase long-term.
Private Mortgage Advisers
It’s often best to secure the services of a private mortgage adviser. These professionals work directly for prospective buyers and are not affiliated with or compensated by lending institutions. There are no conflicts of interest and there is no pressure to get potential buyers to lock into loans right away. When the time is right, your provider can help you find the best lending institutions and loan options for your circumstances, needs, and short- and long-term financial goals. In the meantime, they can help you take steps to better manage and eliminate your existing debt for a more appealing credit profile and increased disposable income. With their help, you can make the dream of condo ownership a feasible one, even as you work to resolve your student debt.
For more information about buying real estate in Downtown San Diego, call (619) 649-0368 and schedule an appointment with a trusted local agent. ')}