Most people have trouble deciding when the time is right for them to buy a home. Keep reading for our five questions to ask yourself to see if you’re ready to take the plunge into home ownership.
1. Am I Sticking Around For Awhile?
In this article you will see the term “buying process” frequently. The steps you take in buying a home is certainly a process, and that is why you should ask yourself these thought provoking questions prior to taking the plunge. The first question you need to ask yourself before you begin is if you plan on staying in your area for awhile. If you don’t love your area, or plan on moving then buying a home might not be the best idea. Of course there are always exceptions to this; however, if you plan to buy you should also plan to stick around.
2. Am I Fully Understanding Of The Costs?
One thing to think about before you start viewing homes is the costs associated with buying one. This extends far past your down payment as there are a laundry list of fees that you must have during the buying process. To name a few: closing costs, homeowner’s insurance, property tax, and other things you have to set up such as utilities and home owner’s association fees. Then there’s always the maintenance costs that you are responsible for when you own your own home. If you are capable of handling these fees in the pursuit of your dream home then you are one step closer to being prepared to starting looking!
3. Do I Have A Good Credit Score?
This is probably a given but for those of you who have yet to take a peak at your credit score – do it now. Having a good credit score is vital to the buying process. Fact: The lower your credit score, the higher your interest rate is likely to be. And that’s why it is important to boost that three-digit number as much as you can before you even get close to the borrowing stage. (Source: Forbes) Basically the higher the number is, the better off you’ll be! If you’ve asked yourself this question and you’ve found this is an area you need to work on before you’re able to start your process that is okay. Don’t get discouraged! There are many ways to build your credit score.
If you want to apply for a home loan visit Emily Mansch’s website and click the “Apply For A Loan” button. Emily can give you the insight on what you need to do to build your credit.
4. Do I Feel As Though I Have Job Security?
You have to ask yourself, “How will I pay my mortgage if I lose my job?” It’s a great idea to make a list of three other places you could try to get employment from if you end up losing your current job. It’s best to think of this in advance so if the situation does come up you already have a backup plan in motion to catch yourself. Another strategic tip to help you prepare for this is to have 1-3 monthly mortgage payments saved in a savings account. If you are unable to save this, it could be a red flag that you should pause on the idea of buying a home.
5. Am I Able To Force Myself To Save?
This leads us into our final question to ask yourself before beginning the home buying process. Are you able to save? Having a savings is key to owning a home as unexpected expenses can pop up at any time. A water leak, lawn care, higher electricity bills – having some savings to cushion any financial falls is needed when you own your home. Start saving now and create a budget of how much money you are willing/able to save and see if that is enough for your needs.
We hope that these tips helped you in knowing what to ask yourself before you buy.