The two words that best describe how to prepare yourself for home ownership from a financial perspective are these: plan ahead.
Before anything else, the first thing you need to do is figure out, regardless of what prices are doing in your chosen area, what you can realistically afford for housing, month after month and beyond. You and only you will be making the mortgage payment, and you need to enter into a purchase that truly works for you.
Once you are at that point, you then reach out to a mortgage professional, we here can help, to see how much house you can afford with your realistic housing budget.
In addition to the monthly payment that you’ll be taking on, there are other considerations, such as the amount of money you’ll need to close the transaction. Beyond your down payment, there are other expenses, such as closing costs, lender fees, interest expenses, and asset reserves.
Saving money for a home purchase can take time, and in keeping with our plan-ahead theme, having at least some idea of how much you’ll need for it sooner rather than later is a good thing.
There are other considerations that will factor into the transaction and determine what interest rate you’ll pay. One of these is what your credit report looks like.
If you are carrying too much debt or the debt you have (such as credit cards) is maxed out, your lender may ask you to either pay some of it down or pay it off completely.
Are there items on your credit report that are incorrect or shouldn’t be there at all? Just as with paying off debt, this can be managed but may take time to complete.
Give us a call so we can help you get in the best buy-ready position you can be in when you start looking at homes.