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Assess your financial situation before buying a house

Before starting your home search, it’s crucial to understand your financial health. Evaluating your income, savings, and existing debts ensures you can comfortably afford a new home. Here's a concise guide to help you assess your financial situation:

  • 3 min read

Evaluate Your Income

  • Calculate Gross Income: Include salary, bonuses, freelance work, and other earnings.
  • Determine Net Income: Subtract expenes and other deductions from your gross income.
  • Assess Stability: Consider the consistency of your income for mortgage approval.

Review Your Savings

  • Check Savings Accounts: Evaluate balances, including emergency funds.
  • Calculate Downpayment: Ensure you have at least 20% of the home’s price saved.
  • Factor Additional Costs: Include closing costs (2%-5% of the purchase price), moving expenses, and initial repairs.

Assess Your Debts

  • List Debts: Include credit cards, student loans, car loans, etc.
  • Calculate Debt-to-Income Ratio: Aim for a DTI below 36%
  • Review Payment History: Ensure timely debt payments to positively impact your credit score.

Check Your Credit Score

  • Obtain Credit Report: Get reports from credit bureau of Bank of Albania.
  • Improve Your Score: Pay down debts, make timely payments.

Create a Budget

  • Track Expenses: List all monthly expenses.
  • Identify Discretionary Spending: Cut back to save more.
  • Set a Home-Buying Budget: Determine a comfortable price range based on your financial situation.

Buying your first home

A housing Loan at Raiffeisen Bank Albania offers below mentioned benefits:

  • Up to 100% financing of the Purchase Price
  • Competitive interests
  • High loan tenor
  • No guarantor required

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