SIGNS YOU ARE READY TO BUY A HOME
If you are a first time home buyer, then there are some ways that you can be sure you are prepared for your purchase. Here are just a few of the signs to help you decide!
YOU HAVE GREAT CREDIT
Your credit score will help determine what your interest rates and mortgage payments will be when you buy your home. Because of this, you should make sure before buying a house that you have good credit.
There are plenty of ways that you can figure out what your credit score is. Do a little research and use your credit score to help you make your decision.
YOU CAN MAKE A GOOD DOWN PAYMENT
When making your down payment on a home, it’s a good rule of thumb to make the payment for at least 20% of the total cost. While this can change depending on your location and the overall cost of the house, you should always make sure that you have the finances to cover a good portion of the house as your down payment.
If you have questions about what a good amount would be, you can ask your realtor for guidance!
YOU ARE ABLE TO GET A GOOD LOAN
Many people need to get a home loan before buying a new home; if you are able to get yourself a good loan with low interest that you can pay off, then you may be ready.
Make sure you do your research on the different types of loans that are available to you. There will be different interest rates and payment options depending on the loan.
If you are unable to find a loan option that has low-interest rates or aren’t sure if you will be able to make the payments each month, then you may want to wait a while. Otherwise, feel free to look around and start home shopping!
YOU AREN’T PLANNING ON MOVING ELSEWHERE ANYTIME SOON
Are you using your home as an opportunity to finally settle down with your family, or is there another move coming up in your future?
If you are hoping to stick around for a while, then getting a home is a great option for you! Whether you’re sick of renting, or need a place to start a new family, you’ll want a more permanent place to settle.
YOU CAN AFFORD REPAIRS
One of the benefits of renting is that your landlord is responsible for repair costs in your building; once you’re in your new home, any repairs necessary will be your problem. If you can afford to make repairs and have a nice emergency fund saved up, then you are prepared to buy a new home.
Home warranties are also a great option if you don’t want to stress about a repair when a problem comes up. Instead, you’ll pay a monthly fee and your repair needs will be taken care of! Be sure to talk to your realtor about these options and stress less later on.
SIGNS YOU MAY WANT TO WAIT
Now that you know some of the signs that you are prepared to buy a home, what are some signs that show you may want to wait? If any of these following statements are true for you, then you may want to hold off on buying a new home.
A LARGE AMOUNT OF YOUR INCOME WILL FUND YOUR HOME
A good rule to follow is that you shouldn’t have more than 30% of your total income going towards house payments. Otherwise, you won’t have the necessary funds for anything else!
Whether we like it or not, emergencies are going to pop up every now and again. Having your finances strangled by making such high payments on your home is not a good way to live. If you aren’t sure you will be able to reasonably cover the costs of your home, it’s best to sit tight.
YOU DON’T HAVE ANY EMERGENCY SAVINGS
Even if you can make your payments each month, having a stash of money available for emergencies is necessary when you purchase a new home. If you haven’t stored some money away for emergencies, then you should wait a while before making a purchase.
Whether you get laid off or have some form of financial setback, if you aren’t able to make a payment one month, you will need to have finances saved up. Get a fully funded savings account prepared for yourself before considering buying a home.
YOUR CAREER PATH IS UNCERTAIN
Are you uncertain whether or not you will stick to the job path you have set for yourself? If the answer is no, then buying a house may not be in your best interest.
It’s important to know what your finances are going to be in the future when buying your first home. If you aren’t sure what your future looks like, then you are better off renting for the time being.
HOME BUYING MADE EASY
Now that you know what signs show you are ready to buy a home or not, you can rest easy and start shopping! Keep these tips in mind when you go to the home buying market.
Do you have any questions relating to the home buying process that we didn’t mention here?
We’d love to hear from you! Contact us with your home-buying questions or concerns anytime.