The best way to buy a home is with cash. This way, you own your home and don’t have to worry about fluctuating interest rates or paying a mortgage if you experience an ill-timed emergency. Unfortunately, most people do not have the money to purchase a home with cash and must rely on obtaining a home loan from a bank to buy the house of their dreams. If you are one of the many Brooklyn new home buyers you may have a more difficult time convincing the bank to give you money for a home especially in today’s soft real estate market. Here are a few tips that may help you get the money you need for the home you want to buy.Before you do anything else, you must look at your credit score. Faced with record foreclosures, banks have tightened their credit requirements. Although not as bad as other places in the country, it is estimated that 1 out of every 1,900 homes in Brooklyn are currently in foreclosure status. For Brooklyn new home buyers to get a loan in today’s market conditions, your score must be in the 600 range before a bank will consider your application and if you hope to get a good interest rate, your score needs to be over 700. Get a copy of your credit report, fix any mistakes, and improve your rating before applying for a loan.

Determine how much home you can afford based on your current income. Banks will look at your debt to income ratio to make sure you are not biting off more than you can chew when it comes to the mortgage. Your monthly payments should be 50 percent or less than your gross income. For example, if your monthly paycheck is $3,000 then your mortgage shouldn’t be over $1,500. Based on a 30 year mortgage, you can afford a home priced around $540,000. However, Brooklyn new home buyers need to consider other monthly bills like car payments as well.

When shopping for a home loan, it is best to start with the bank where you have an account. Many banks will offer their current customers a better deal than they will people who have never done business with them before. However, don’t be afraid to shop around especially if you are Brooklyn new home buyers. Banks are starving for customers right now and it is possible to negotiate a better deal with a lender looking to attract new clients.