Guru Speak

This will not always be the case, as interest rates can fluctuate and will undoubtedly rise again at some future point, so if you are interested in buying a home, now might just be a very good time to do so.

As a lender, I hope you will permit me to provide you with some vital tips to assist you with your homeloan decisionmaking process.

When buying a home, most buyers understandably focus on interest rates.

However, when borrowing long term, such as for a home, it is of utmost importance to take into equal consideration the stability of your income and cash flow situation to ensure that you will not run into a problem making ends meet.

When calculating affordable monthly instalments, you should be mindful of your other expenses and carefully consider how much you can afford.

Do not try to make your loan as short as possible, as this will raise your monthly payments.

The recommended debttoincome ratio is onethird of your monthly income in order to allow adequate funds for your other living expenses.

It is also very important to make sure that you have three to six months income set aside in case of any serious setback to your financial situation, such as a prolonged economic downturn or personal misfortune.

This cushion will provide you with time to work out any problems while you get back on your feet.

When buying a home, you must consider other costs and factors as well, such as transfer fees, property values and location.

This year, as part of the government's economic stimulus measures, a taxdeductible incentive will be offered to homebuyers as well as a reduction in transfer fees.

It is not known how long this policy will stay in effect, so it would be best not to wait too long if you want to take advantage of these measures.

With the current economic downturn, developers are also offering special deals to attract homebuyers. You will find an ample choice of projects in good locations, which will further stretch your realestate dollar, or rather "baht".

With today's unfavourable economic climate, it is necessary to remind borrowers that they should not borrow money in order to pay off loans. Doing that will only make matters worse.

If you feel that you may not be able to cover your future instalments, you should remember that almost every problem has a solution.

Talk to your bank and tell them the truth. They will most likely be eager to help you, often by extending the loan term and reducing your monthly instalments. Banks do not want problem loans in their portfolio, so they are just as interested in solving your problem as you are.

There are of course other factors to consider, but following these key tips will go a long way toward helping you sleep peacefully without being troubled by homeloan nightmares.