Are you thinking about buying your first home? If so, you are certainly feeling excited about this new step in your life. I know because I was in your shoes not too long ago. But are you ready? A lot of people rush into buying their first property because they feel pressured to do so or they are not emotionally capable of delaying the gratification. Buying a home is not must, in fact, you can go your whole life without buying one. There are no rules! With that said, if you feel ready to make a move, read on to discover some of the parameters that may indicate that you are ready to buy your first home…
You have a great credit score – There is only one place to begin, and this is with your credit score. If you have a poor credit rating, you are going to find it incredibly difficult to get a mortgage. If you have a fair rating, you may be able to secure a mortgage (I recommend being patient and working on improving your score) but it is likely that the rates will be very high.
Your job is stable – Generally, a mortgage is the highest bill of a household and the most important, unless you’re comfortable being homeless. As such, it is important to be in a position to never have to struggle to make the monthly dues. This cannot be accomplished if you do not have a constant stable stream of income. Do you feel your job is stable? It is never a good idea to get a mortgage if your source of income is not constant.
You are settled in the area – Another crucial indicator when it comes to buying your first property is being settled in the area. I live in the Washington D.C. area and it’s a very dynamic place. With a large proportion of the population working for the federal government and the military, families get moved frequently. If you’re unsure of your home for the next five years, rethink your home purchase. Do you feel confident that you will be happy living here for the foreseeable future? You need to be willing to put down roots, make friends, socialize and potentially raise a family.
You have been pre-approved for a mortgage – When it comes to residential mortgages, getting pre-approved is important. After all, the last thing you want to do is to find the house of your dreams only to discover that you cannot get a mortgage for it.
The finances add up – Aside from the points that have already been mentioned, you need to make sure buying your first home makes sense from a financial point of view. It is important to draw up a budget of all of your income and expenses to make sure you can comfortably afford the mortgage. Furthermore, you need to make sure that you can afford the start-up costs; not just the deposit, but removal expenses, legal fees, and so on. Experts recommend adding 10 per cent onto your budget just to be certain. After being a homeowner for a couple years, I can guarantee you that you will spend an average of $750 to $1500 per month to maintain your home in good condition. Be aware of these additional costs.
So, there you have it: a few different signs that show you are ready to purchase your first property. If you have noticed any of the signs that have been mentioned above and they are positive in your favor, you are probably feeling confident that now is the right time. However, if this is not the case, there is no need to panic. Remember, buy a property when you are ready financially.