Buying a home is one of the most exciting milestones in life — but before you start scrolling through listings or scheduling showings, it’s important to take a step back and look closely at your finances.

At Preferred Properties of Texas, we help homebuyers across Stephenville and the surrounding areas make smart, informed decisions. One of the first — and most crucial — steps in the homebuying process is understanding what you can realistically afford.

Get a Grip on Your Finances

We know it’s more fun to look at homes than to analyze your budget. But getting a handle on your financial situation early on will help ensure a smoother journey to homeownership. Start by gathering key information and asking yourself a few questions:

• What is your gross (pre-tax) monthly income?

• What are your average monthly expenses?

• Are you carrying credit card or other debts?

• How much do you currently have in savings?

Most lenders recommend that your mortgage payment — including principal, interest, taxes, and insurance — should not exceed 28% of your gross monthly income. This helps keep your budget balanced and prevents financial stress down the road.

Credit Counts

Your credit score plays a major role in the loan approval process. It can affect not only your ability to qualify for a mortgage but also the interest rate you’ll receive. A higher credit score typically means better rates and lower monthly payments.

We recommend pulling your credit report early in the process so you can correct any errors and take steps to improve your score if needed.

Keep an Eye on Mortgage Rates

Mortgage interest rates fluctuate with the market, and even a slight increase can impact how much house you can afford. Staying informed about current rates will help you make the right move at the right time — and lock in a rate that works for your budget.

Plan for More Than Just the Mortgage

There are several upfront and ongoing costs associated with buying a home:

• Down Payment: Usually between 5% and 20% of the home’s purchase price (as low as 3% for some loan types).

• Closing Costs: These generally range from 2% to 5% of the purchase price and include fees like appraisals, credit reports, and title services.

• Homeownership Expenses: Don’t forget to account for maintenance, utilities, and property taxes after move-in.

Work with a Trusted Lender

Your lender plays a key role in helping you understand exactly what you can afford. They’ll look at your full financial picture and help you find a comfortable loan amount that fits your short-term and long-term goals.

At Preferred Properties of Texas, we work hand-in-hand with experienced lenders who understand our local market and can provide personalized guidance every step of the way.

Helpful Tools to Get Started:

Homebuying Budget Calculator – Estimate how much house fits your budget.
Budgeting for Homeownership – Learn what it really costs to own and maintain a home.

Ready to start the homebuying journey in Stephenville or the surrounding areas?
Reach out to Preferred Properties of Texas today — 254-965-7775, we’re here to help you find the perfect home, ranch, commercial property or land at the right price.