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Home ownership is a challenging and rewarding experience for the savvy buyer. Protecting yourself against the common pitfalls of home ownership begins before the closing of the sale.

One of the biggest mistakes that people make is spending more than they can afford on a home. When lenders determine your qualifying loan amount, they look at your liabilities as well as your assets. Liabilities include monies owed to other lenders, but do not include living expenses such as groceries, charitable giving, and household expenses. If you add the amount of your living expenses plus payments you make to creditors, you will discover that the amount of money you have available to pay toward a mortgage is less than your mortgage company reports. The amount you can afford to pay monthly on your mortgage is a lot different than the loan amount you can qualify for.

Once you have selected a home you want to buy, schedule a home inspection by an independent licensed professional. The American Society of Home Inspectors can direct you to a professional inspector in your area. Visit their website at: http://www.ashi.org/. A home inspection will reveal problem areas that need to be corrected before you agree to a purchase. If your inspector discovers major defects, walking away from the purchase may be the best course of action unless the seller agrees to make repairs.

Before you purchase your dream home, check its flood status. If your dream home is located in a flood plain or in a flood prone area, you may be required to purchase flood insurance, an additional cost above the regular home owner's insurance. The National Flood Insurance Program was created in 1968 to help homeowners whose homes are in a designated flood area reduce their liability in the event of a flood. For more information visit the website at: http://www.floodsmart.gov/floo dsmart/. Some homes not designated in a flood prone area may be located in low lying areas and experience some periods of flooding. Check with neighbors about flooding in the neighborhood and look for signs of previous flooding in the home. Damages due to flooding are not covered in most homeowner insurance policies, and can be quite costly.

Once your home purchase has been completed, you may want to renovate your new space. Often times the costs associated with the purchase of your dream home may leave you short of funds for major renovations or remodeling. Determine before you buy how much money you will have available for remodeling

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