75-6159 HAKU MELE PL Kailua Kona, HI 96740
It’s the dream of many around the world to live on the Big Island of Hawaii, in one of the most luxurious neighborhoods or resorts such as Kohala Ranch, Kukio, or Kohanaiki. If you’re a first-time buyer, no doubt you’re excited and perhaps even overwhelmed. It’s important to realize that taking your time and approaching it gradually will help you avoid stress and disappointment. As trusted real estate professionals of luxury real estate on the Big Island, we have a few suggestions to help you reach the finish line with fewer obstacles and less stress.
Having money in the bank is always a good thing. Some who purchase a luxury home are wealthy, while others have to save up and scrutinize their spending in order to decide whether they can actually afford an upscale home. If you’re not particularly wealthy, start saving now. It’s a good idea to determine your total monthly living expenses, and have at least enough for three to six months in the bank before you buy. Additionally, you’ll see that making the down payment won’t be so painful, and lenders will look upon you more favorably.
How much can you afford to pay on a mortgage? Most experts recommend that homeowners spend only about 35% or less of their monthly income on mortgage payments, so list your monthly expenses and calculate how much of your income equals 35% to see if you can really afford that home you’re interested in. You may earn $240,000 per year which according to the above formula means you could pay up to $7,000 per month on your mortgage, but it’s vital to keep other monthly expenditures in mind.
Know your credit score and how you can repair it if necessary. Your credit score is one of the biggest factors when it comes to obtaining a loan and its associated interest rates. Closely examine your report to ensure all of the information is accurate, and follow up with any errors that could be negatively impacting your score. Large companies and corporations DO make mistakes, in fact more often than you might think.
Your lender is your most important ally, so find one you trust and feel comfortable with. Lenders are thoroughly familiar with all of the aspects of purchasing a home, and can help you understand how much you can really afford to pay for a home, what type of mortgage is most suitable in your case, etc. Your lender can assist you when it comes to locking in an interest rate, getting pre-approved, and locking down the price range that’s perfect for your financial situation.
At Mauna Kea Realty we realize that many Big Island luxury home buyers have substantial wealth and don’t have to worry about mortgages, credit scores, and other details. However many buyers are financially comfortable, but perhaps on the cusp of knowing what they can and cannot afford, how it may impact their budget, and other factors. We want to help you with every detail before you begin searching in earnest for the Big Island luxury home of your dreams! Give us a call now so your journey can begin.