Four Signs that Indicate It’s Time to Buy Your Own Home
Buying your first home is both exciting and nerve wrecking. If you are thinking about buying into the dream of homeownership, you need to consider if you are ready to purchase a home. It is one of the largest financial decisions you’ll take in your life. But how do you know when is the right time for you to buy your first house? You need to look at various factors like property location, pricing, mortgage rates to determine your preparedness and ability to pay for homeownership and other associated costs.
There are many questions to answer when you prepare to buy your first home. Knowing answers to the following questions will help you find out if you are ready to move into your own house:
- Do you have a stable income?
- Have you saved enough for a down payment?
- Do you qualify for a home loan?
- Can you afford monthly premium payments and other associated costs and fees?
Homeownership is not for everyone, at least for those who are not financially stable in their lives. Here’re four signs that you are ready to purchase your first home without facing any difficulty.
You have a steady job/business and income
The first thing you should do is to look at if you have a steady employment/business to pay all your bills and debt. While any job or business comes with uncertainties, the longer you are in the industry and with your current company, the better position you will be in to have a steady income to bear your expenses before and after the purchase. With a higher paycheck in your job, you are all set to fulfill your dream of ownership.
You are ready to stay in the same area for a long-term
When you are ready to invest in homeownership, it’s important to know if you are going to stay in the house you are purchasing for the next 5-10 years at least. If you are planning to buy a house to live in with your family, make sure you are going to live there for the long term. Consider: “Am I going to work in the same company on any other company in the same area for years to come? Will the home I am purchasing fulfill my family’s growing needs in the future? Will my kids have access to a good school close by?” If it makes financial sense and you are comfortable living in that particular location, you are ready to purchase a home for long-term living.
You have enough cash for a down payment and future maintenance
Purchasing a house requires you to bear a few up-front costs and maintenance costs associated with homeownership. The biggest one is the down payment that you need at the time of house buying, depending on your mortgage type. It could be anything in between 0%-20% of the purchase price of the house you. Make sure you have saved enough for the down payment to pay the upfront cost associated with home buying. Also, you must have an emergency fund left with you in your pocket to make payments for future bills, taxes, and maintenance costs associated with owning a house in your area.
You meet the lending criteria
Getting a home loan is the best way to pay the price of the house you are purchasing through monthly/quarterly on yearly installments. It saves you from any financial burden that you can have when purchasing it outright with cash. If you have a decent credit score, meet eligibility criteria, and can afford mortgage payments and interest rates, you are all set to apply for a home loan and get it approved from the lender. Check for various mortgage products available from banking institutions and lenders in your area to know which home loan program is best for your requirements.
These are the common signs you are ready to purchase your first home finally. Remember to make a plan, determine your requirements, make a budget and stick to them to meet your homeownership goal. Consult with experts and professional real estate and mortgage brokers to discuss your requirements to make a well-informed decision.