Adulthood comes at you fast and with it comes a lot of unexpected responsibilities. These responsibilities include shopping for groceries, washing the laundry… and dishes, thinking about the possibilities of living with roommates or a spouse, or raising the smaller kind of roommates, other words known as, having kids. \
One of the things that these responsibilities bring about is the thought of buying your own house.
Buying a house of your own is something you’ll have to deal with sooner or later because of the stability it can bring. This could be due to a variety of reasons, be it the fact that you no longer want to be a tenant in someone else’s apartment, or that you are financially ready to shop for your home and rate with your down-payment.
How to Know If You’re Ready to Buy Your First Home
Buying your first home is a very special and exciting experience. It’s a process that takes a lot of time and planning. You don’t wake up one day and suddenly decide to give away your savings to purchase a house.
While some plan for it for years, others seal the deal in a matter of weeks – the decision-making process varies from person to person. However, there are some universal signs that you’re ready to buy your first house:
1. You Don’t Want to Live on Rent Anymore
If you’re a young person who has been working for quite a few years, chances are that you’ve been a tenant at one or a couple of different places by now.
While the nomadic life seems fun at first, after a certain point you just don’t want to rent or live with mom and dad anymore. Having a place to call your own has its benefits such as not answering to a landlord or a parent. Being a homeowner allows you to have that freedom.
Additionally, if you feel like you belong in a particular city and are quite certain that you will be staying there for the next several years, it is unquestionably a good idea to buy your own house.
Related Video: Are You Ready to Move
2. You Have a Secure Job Situation
As a young adult, it may take a while to find solid footing in terms of job placement and security. However, perhaps after working for a few years, you might finally find stability in a company and be ready for a long term position.
Having that job security will allow you to make financial decisions that you probably wouldn’t have been able to take earlier, and that includes buying a new house.
If you have a job that offers you good work life balance, health benefits and other advantages, you might want to make use of that security to invest in a house of your own.
3. You Can Vouch for Steady Finances
Apart from a steady job, there are several ways to account for a steady financial situation. This could be through investments in real estate, the stock market, a part-time “side hustle” where you follow your passion turning it into a business on the side.
Just take a look at your finances, and see what the recurring monthly expenses are. Learn the benefits both in locking in a payment that won’t change for 30 years and having a place to start your very own business that can act as a tax write off. In any case, you should begin to consider pooling in your savings towards a new home.
4. You’re Ready for Commitment
A very good reason to want to buy your own house is if you’re planning on getting married or moving in with a partner. Having a studio or a one bedroom apartment can be fine if you’re living on your own with a pet.
However, if there’s someone to consider in your life and the two of you are about to get married soon or move in together, you’ll be needing to plan together. This is the perfect opportunity to buy your first house and build on your partnership together.
Commitment also relates to mental maturity – once you feel mentally responsible enough to get your own place, go for it.
5. You Genuinely Need More Space
Are you about to have a kid? Planning on having one soon? Then you definitely feel the need for a lot more space. This is the perfect time to buy your own home. It’ll give your kids a lot of space to move about freely, without bumping into each other and invading personal spaces.
You might also need more room in case you want to set up a corner for yourself – to practice hobbies, work from home, etc. Some extra breathing room from the kids is always a great add, either way.
6. You Don’t Have Debt to Worry About
Paying bills and having debt is an obvious concern when you have several expenses to take care of. However, if you’re not under any kind of debt (for example, if you’re already done paying off the new car) and your credit card bills are clear, then now is a good time to consider investing in a new house.
With money available to pay for your mortgage and liquid cash you can put towards the other expenses of owning a house, this is one of the safest time periods to buy a home.
7.You Have a Decent Credit Score
When you go to apply for a mortgage, banks, and lenders will look at your credit score in order to ensure that you can pay them back on time. If you have a decent credit score, you should have nothing to worry about.
Your credit score reflects on your past expenditure and activities related to timely repayment. A credit score above 720 is considered stellar, and yours can be anywhere between 300 to 850. Our team will provide a complimentary credit report and analysis to teach you how to boost your points prior to locking in your interest rate, to get the most savings possible.
Only once you’ve shored up your credit score to an above-average level should you even consider homeownership, lest you be straddled with extremely high rates.
Related Video: How Does My Score Impact My Loan
Free Credit Check Tool – sponsored by the government to run your credit once per year or follow our link to get a free triple score, absolutely no official application required, and our website is completely secure https://maresmortgage.com/credit-authorization/
8. Your Down Payment is Sorted
It is usually suggested that you have about 20% of the total cost of your house ready for a down payment. Even if you have 3 to 10% of it available outside of your other savings, consider yourself ready to buy a house depending on the area you plan to search.
In case you decide to give 15% or 20% as a down payment, that’s ideal because then you can avoid the requirement for PMI (private mortgage insurance). But we have programs to offer the ability to eliminate PMI (Private Mortgage Insurance) without putting 20% down.
In fact, it’s so much better to get the initial percentage out of the way. The more you put down as a down payment, the lower will be your monthly payment, thereby making your financial position post-purchase much stronger. But leveraging and saving the difference can be a smart strategy.
Related article: First Home Buying Tips and Tricks
9.You Know About the Market
There are a lot of things you need to figure out before deciding to buy a house of your own. This includes knowing which neighborhood meets your lifestyle and safety concerns, the mortgage broker or banker that offers the best mortgage options, the condition of the real estate market, and expected changes to the rates.
If you’ve had your own eyes on a specific locality, chances are you want to get your own first house there and are also aware of how good the area is for a long-term commitment. Once you’re confident you know your real estate, it’s a good time to go forward with it and put your money and that know-how to work.
10.You Feel Emotionally Prepared
Getting a new house is challenging in many ways. Regardless of whether you’re moving to the new place alone, with your partner, or with your family, the entire process can be extremely overwhelming. Therefore, one should do it only when they’re emotionally ready. Once piece of advice, no one can give you the confidence to buy, it all comes from within.
There will be several things that will go wrong, and hurdles that you will have to face – only if you’re emotionally prepared to face them will obtain the best outcome possible given your circumstances.
This also includes being able to deal with the little things post-closing involved in getting your new house, such as, decoration, repairs that potentially escaped the scope of work of your home inspectors and Realtors, or just general upgrades if you purchased a fixer-upper, etc.
Once your mind and heart are in sync regarding this period of transformation, however, you can take the leap.
Ready to buy a home, see how Mares Mortgage has a team that can help!
It’s a great feeling to buy your first home; it’s your baby and there’s so much you want to do with it. However, there’s a unique responsibility that comes with being a homeowner, before, as well as, after the process.
You have to be mentally and financially prepared to face all the challenges and duties about to come your way when buying your first home.
If you truly feel that your financial situation is secure enough and you can handle all the normal expenses while being able to pay off your mortgage and other house-related expenditures, it’s time to take the leap. Homeownership is, at the end of the day, one of the most rewarding parts of growing up.
Related article: First Home Buying Tips and Tricks